Coursera (COUR): Assessing Valuation After Upbeat Earnings, New AI Initiatives, and Raised Revenue Guidance

Coursera (COUR) grabbed investor attention this week after reporting solid third-quarter results, showing revenue growth and improved profitability compared to last year. Management also raised full-year revenue guidance, which reflects confidence in future prospects.

See our latest analysis for Coursera.

Even with Coursera’s upbeat quarterly report and an upgraded annual revenue outlook, the share price has struggled to build momentum lately. It has dropped nearly 18% over the past month and more than 30% over the last quarter, as investors weighed both growth in AI-powered offerings and concerns about the pace of Enterprise segment expansion. Despite these headwinds, the one-year total shareholder return stands at a solid 21%, showing that longer-term holders have still come out ahead.

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With shares trading well below their recent highs and the company lifting its full-year sales outlook, investors are left wondering if Coursera is undervalued at current levels or if the market has already factored in its renewed growth trajectory.

Most Popular Narrative: 31.2% Undervalued

With Coursera’s last close at $8.42 and the most widely followed narrative setting fair value at $12.23, expectations point toward further upside even after the company’s improved guidance.

Expansion and deepening of enterprise partnerships, especially across business, government, and campus verticals, provide large-scale, recurring, and higher margin revenues. As these contracts mature and the enterprise customer base grows, net margins and earnings are positioned to improve further.

Read the complete narrative.

Curious what kind of future profit margins and revenue growth are needed to justify this bold upside? The narrative’s numbers rely on ambitious improvements in scale and efficiency. The full story reveals the assumptions driving that target—are they too optimistic, or just the start?

Result: Fair Value of $12.23 (UNDERVALUED)

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

However, intensifying competition and lingering doubts about credential value could threaten Coursera’s growth story and put pressure on both margins and revenue projections.

Find out about the key risks to this Coursera narrative.

Another View: Market Multiples Tell a Different Story

While the analyst narrative focuses on future growth and improving profitability, market multiples present a less optimistic perspective. Coursera is trading at 1.9 times its sales, which is higher than both its industry peers (1.5x) and the broader US Consumer Services industry (1.3x). This difference suggests the stock could be at risk of a downward market re-rating if expectations are not met. Is the market giving Coursera too much credit for future growth

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Coursera Narrative

If you have your own perspective on Coursera’s story or want a hands-on look at the numbers, you can quickly build your own investment view in just a few minutes. Do it your way

A great starting point for your Coursera research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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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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