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Stride
(NYSE:LRN)
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Rating:71Outperform
Price Target:
$89.00
▲(2.44% Upside)
Action:Reiterated
Date:08/05/26
LRN scores strongest on financial performance (notably robust and improving cash flow generation and a strengthening balance sheet) and is supported by an attractive earnings valuation (low P/E). These positives are meaningfully offset by weak technical momentum (price below key moving averages with negative MACD) and a mixed near-term narrative from the earnings call (margin compression, general education declines, and leadership transition concerns despite stable-to-slightly improving operational indicators).
Positive Factors
Cash generation
Stride's strong and improving cash generation—with free cash flow roughly in line with net income and multi-year OCF growth—creates durable financial flexibility. High cash conversion supports buybacks, strategic tech investments, and cushions the business against enrollment or funding volatility.
Negative Factors
General education declines
Declines in the core public K–12 (general education) segment erode the company's predictable, per-student funding base. Sustained enrollment weakness here would reduce revenue stability, increase reliance on higher-growth but potentially less predictable segments, and complicate medium-term planning.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Stride's strong and improving cash generation—with free cash flow roughly in line with net income and multi-year OCF growth—creates durable financial flexibility. High cash conversion supports buybacks, strategic tech investments, and cushions the business against enrollment or funding volatility.
Read all positive factors
Stride (LRN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.41B
Dividend YieldN/A
Average Volume (3M)842.27K
Price to Earnings (P/E)11.2
Beta (1Y)0.24
Revenue Growth10.93%
EPS Growth2.97%
CountryUS
Employees8,600
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)7.92
Shares Outstanding42,524,840
10 Day Avg. Volume737,534
30 Day Avg. Volume842,274
Financial Highlights & Ratios
PEG Ratio0.59
Price to Book (P/B)2.26
Price to Sales (P/S)1.46
P/FCF Ratio10.38
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$109.00Price Target Upside25.46% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)7.43
Revenue Forecast (FY)$2.64B
Stride Business Overview & Revenue Model
Company Description
Stride, Inc. (LRN) is a U.S.-based education company that provides technology-enabled learning solutions for K–12 students. The company operates online and blended public-school programs (including full-time virtual schools, blended schools, and r...
How the Company Makes Money
Stride primarily makes money through a mix of public-sector education funding tied to student enrollment and program services, and through tuition and fee-based education products. A major revenue stream comes from its General Education segment, w...
Stride Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Oct 27, 2026
Earnings Call Sentiment Positive
The call presented a mix of encouraging operational and financial progress (revenue and enrollment growth, strong career learning performance, improved EBITDA and EPS, healthy cash balance and active buybacks, and strategic technology investments) alongside notable near-term challenges (gross margin compression, declines in general education revenue/enrollments, modest free cash flow decline, a district contract non-renewal, and investor concern around a sudden CEO transition). Early enrollment indicators are mixed but include improving conversion and re-registration metrics; management expects FY27 margins to be flattish but acknowledges tougher year-over-year comparisons and continued investments that will weigh on near-term margins.Positive Updates
Revenue Growth and Scale
Fiscal 2026 revenue of $2.518 billion, up 4.7% year-over-year, reflecting continued demand and scale across programs.
Negative Updates
Gross Margin Compression
Gross margin fell to 37.8%, down 140 basis points year-over-year, driven by investments and ongoing platform-related expenses.
Read all updates
Q4-2026 Updates
Positive
Negative
Revenue Growth and Scale
Fiscal 2026 revenue of $2.518 billion, up 4.7% year-over-year, reflecting continued demand and scale across programs.
Read all positive updates
Company Guidance
Management said it will provide formal FY27 guidance in October but gave directional expectations based on FY26 results: FY26 revenue was $2.518B (+4.7%) with adjusted operating income $498.4M (~+7%), adjusted EBITDA $617.6M (+8.2%), adjusted EPS $8.33, total students ~244k (+4.2%), career learning revenue $1.04B (+19%) with 110k enrollments (+14%), general education revenue $1.42B (‑2%) with 134k enrollments (‑2.5%), revenue per enrollment $9.91k (vs $9.68k), gross margin 37.8% (‑140 bps), SG&A $499.8M (‑4.7%), stock‑based comp $40.3M, effective tax rate 23.3%, CapEx $78.8M, free cash flow $355M, cash and marketable securities ~$1.034B, and ~$189M of shares repurchased in FY26 with ~$311M remaining through 10/31/2027; for FY27 they expect revenue per enrollment to be relatively flat to slightly up, gross margins flattish, CapEx and SG&A as a percent of revenue relatively flat, a modest uptick in stock‑based compensation and tax rate, and cautioned that count‑date growth will face a tougher comparison even as applications are slightly behind last year while conversion and re‑registration trends are improved and in‑year enrollment growth is expected.Stride Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
83
Very Positive
Cash Flow
90
Very Positive
| Breakdown | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.52B | 2.41B | 2.04B | 1.84B | 1.69B |
| Gross Profit | 950.60M | 943.92M | 763.60M | 647.07M | 596.48M |
| EBITDA | 579.50M | 508.39M | 386.18M | 291.31M | 253.26M |
| Net Income | 338.19M | 287.94M | 204.18M | 126.87M | 107.13M |
Balance Sheet | |||||
| Total Assets | 2.44B | 2.29B | 1.92B | 1.76B | 1.64B |
| Cash, Cash Equivalents and Short-Term Investments | 958.00M | 985.27M | 692.29M | 522.73M | 389.40M |
| Total Debt | 545.98M | 549.76M | 528.21M | 543.81M | 565.67M |
| Total Liabilities | 803.22M | 814.34M | 744.44M | 813.37M | 830.96M |
| Stockholders Equity | 1.63B | 1.48B | 1.18B | 947.30M | 812.58M |
Cash Flow | |||||
| Free Cash Flow | 354.97M | 372.81M | 217.21M | 136.60M | 139.26M |
| Operating Cash Flow | 433.81M | 432.82M | 278.80M | 203.15M | 206.88M |
| Investing Cash Flow | -179.83M | -88.00M | -139.87M | -118.24M | -110.76M |
| Financing Cash Flow | -281.98M | -62.94M | -49.12M | -63.50M | -93.31M |
Stride Technical Analysis
Negative
86.88
Price Trends
89.19
Negative
90.04
Negative
84.27
Negative
Market Momentum
-1.95
Positive
40.30
Neutral
16.61
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LRN, the sentiment is Negative. The current price of 86.88 is above the 20-day moving average (MA) of 86.29, below the 50-day MA of 89.19, and above the 200-day MA of 84.27, indicating a bearish trend. The MACD of -1.95 indicates Positive momentum. The RSI at 40.30 is Neutral, neither overbought nor oversold. The STOCH value of 16.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LRN.
Stride Risk Analysis
Stride disclosed 45 risk factors in its most recent earnings report. Stride reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Stride Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $1.82B | 13.33 | 8.19% | 3.17% | 3.53% | 23.97% | |
78 Outperform | $1.99B | 11.91 | 17.21% | 1.98% | 17.75% | 15.21% | |
71 Outperform | $3.41B | 11.20 | 21.31% | ― | 10.93% | 2.97% | |
63 Neutral | $1.52B | -7.46 | -17.74% | ― | 22.69% | -112.56% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
53 Neutral | $2.10B | 63.50 | 5.48% | ― | 0.07% | ― |
* Consumer Defensive Sector Average
LRN
Stride
80.00
-64.05
-44.46%
PRDO
Perdoceo Education
32.45
2.18
7.18%
STRA
Strategic Education
82.46
7.55
10.07%
COUR
Coursera
5.56
-6.53
-54.01%
MH
McGraw Hill, Inc.
11.55
-1.40
-10.81%
Stride Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
Stride posts strong fiscal 2026 results, boosts buybacks
Positive
Aug 4, 2026
On August 4, 2026, Stride reported fourth quarter and full-year fiscal 2026 results for the period ended June 30, 2026, showing solid annual growth despite weaker fourth-quarter revenue. Full-year revenue rose 4.7% to $2.52 billion, while income f...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Stride appoints new CEO amid strong preliminary results
Positive
Jul 30, 2026
On July 29, 2026, Stride executed a major leadership transition, with long-serving CEO and board chair James J. Rhyu stepping down without dispute over company matters, and independent director Robert E. Knowling appointed chief executive officer....
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.