K-12 Education Is Changing: Can Stride Lead the Next 25 Years?

Stride, Inc. LRN continues to redefine digital education at a time when dissatisfaction with traditional public schooling is hitting historic highs. In its fiscal third-quarter 2025, this online education provider reported a 17.8% year-over-year revenue jump to $613.4 million—beating estimates by $20 million—driven by a 21% surge in total enrollment. Career learning revenue alone grew 33% to $223.9 million, bolstered by 34% enrollment growth.These numbers highlight the structural tailwinds favoring Stride. As highlighted by the company in its fiscal third-quarter earnings call, February Gallup Polls suggest that nearly 90% of parents now explore non-college career paths for their children, and more than 15% have considered full-time online schooling—up sharply from pre-pandemic levels. Stride is actively meeting that demand through its career-focused middle and high school programs, tutoring platforms, and innovations like K12 Zone and geo-based social pods that blend digital and real-world interaction.Importantly, management raised its full-year revenue and operating income guidance for fiscal 2025 and is already on track to surpass its 2028 CAGR targets three years early. Despite a slight EPS miss due to higher share count from convertible notes, Stride's fundamentals remain robust, with adjusted operating income up 47% and gross margin expanding 190 basis points to 40.6%.Yet, challenges remain. State-level enrollment caps and the lack of traction in lower grades could limit upside. Still, if Stride can expand its footprint and capitalize on shifting education preferences, its ambitions to lead the next 25 years of K-12 innovation may not be far-fetched.Can Stride Stay Ahead of Chegg and Coursera in Online Learning?As Stride charts its path for the next 25 years of K-12 transformation, competitors like Chegg CHGG and Coursera COUR are also shaping the future of digital education—albeit through different models. Chegg, best known for its study tools and textbook services, is pivoting toward AI-driven learning support. While Chegg doesn’t directly compete in K-12 full-time enrollment, its tools increasingly serve high schoolers preparing for college or workforce credentials. Chegg’s push into personalized learning may pressure Stride to deepen its academic support offerings.Coursera, meanwhile, is expanding its footprint in online credentialing and high school dual-enrollment programs. Coursera has partnered with universities and governments to offer scalable, low-cost education alternatives—posing a growing challenge to Stride as career education becomes mainstream in K-12. As Stride strengthens its middle and high school pathways, it must continue to differentiate itself from both Chegg and Coursera to maintain its leadership.LRN Stock’s Price PerformanceShares of this Virginia-based education company have trended downward 8.3% over the past three months, underperforming the Zacks Schools industry and the S&P 500 index.LRN Share Price PerformanceImage Source: Zacks Investment ResearchStride’s Valuation TrendStride stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 2.17, as evidenced by the chart below.LRN ValuationImage Source: Zacks Investment ResearchEarnings Estimate Revision of LRNLRN’s earnings estimates for fiscal 2025 and 2026 have remained unchanged over the past 60 days at $7.09 and $7.76 per share, respectively. However, the estimated figures for fiscal 2025 and 2026 imply year-over-year growth of 51.2% and 9.4%, respectively.EPS TrendImage Source: Zacks Investment ResearchLRN stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Stride, Inc. (LRN): Free Stock Analysis Report Chegg, Inc. (CHGG): Free Stock Analysis Report Coursera, Inc. (COUR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks