Strategic Education (STRA): Reassessing Valuation After a Recent Share Price Rebound

Strategic Education (STRA) has quietly outperformed the market over the past month, gaining about 7%, even as its year to date and 1 year returns remain negative. That gap sets up an interesting value discussion.

See our latest analysis for Strategic Education.

With the share price now at $80.21, that recent 1 month share price return of about 7% looks more like a rebound within a still weak year to date trend than a breakout. This suggests sentiment is improving but longer term conviction is not fully back yet.

If you are reassessing your education exposure, it might also be a good time to scan other opportunities across fast growing stocks with high insider ownership and see what else is starting to build momentum.

Given solid earnings growth, a sizeable discount to analyst targets and modest revenue expansion, investors now face a key question: Is Strategic Education mispriced value, or has the market already embedded its future growth trajectory?

Most Popular Narrative Narrative: 22.4% Undervalued

With Strategic Education last closing at $80.21 against a narrative fair value of $103.33, the spread points to meaningful upside if assumptions hold.

The analysts have a consensus price target of $112.333 for Strategic Education based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $120.0 and the most bearish reporting a price target of $97.0.

Read the complete narrative.

Curious how steady revenue growth, rising margins and a richer earnings multiple combine to justify a premium price tag? Unpack the full playbook behind this valuation call.

Result: Fair Value of $103.33 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, shifting visa rules in Australia and persistent pressure to lower student costs could weigh on revenue per student and slow margin expansion.

Find out about the key risks to this Strategic Education narrative.

Build Your Own Strategic Education Narrative

If you want to challenge these assumptions or dig into the numbers yourself, you can craft a custom narrative in just a few minutes: Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Strategic Education.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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