Strategic Education (NASDAQ:STRA) Cut to Hold at Wall Street Zen

Key Points

• Wall Street Zen downgraded Strategic Education from “buy” to “hold.” Other analysts also cut ratings; MarketBeat reports a consensus “hold” rating and an average price target of $87.
• Strategic Education’s third-quarter revenue increased 1.6% year over year to $325.1 million but missed estimates, while EPS of $1.72 came in below forecasts of roughly $1.92–$1.95. A reported $134 million Torrens writedown weighed on results.
• Shares opened at $52.20, near the company’s 52-week low of $51.01. The company also declared a quarterly dividend of $0.60 per share, equivalent to $2.40 annually.

Strategic Education (NASDAQ:STRA - Get Free Report) was downgraded by investment analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a research report issued on Saturday, Wall Street Zen reports.

STRA has been the subject of a number of other research reports. Weiss Ratings lowered Strategic Education from a "hold (c+)" rating to a "hold (c)" rating in a research report on Wednesday, October 28th. BMO Capital Markets lowered shares of Strategic Education from an "outperform" rating to a "market perform" rating and lowered their price target for the stock from $95.00 to $66.00 in a report on Friday. Truist Financial increased their price target on shares of Strategic Education from $80.00 to $90.00 and gave the stock a "hold" rating in a report on Thursday, July 30th. William Blair lowered shares of Strategic Education to a "market perform" rating in a research report on Friday. Finally, Barrington Research cut shares of Strategic Education from an "outperform" rating to a "market perform" rating in a research note on Friday. Six equities research analysts have rated the stock with a Hold rating. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and an average price target of $87.00.

Strategic Education Stock Performance

Shares of STRA opened at $52.20 on Friday. The business's 50 day moving average price is $78.93 and its two-hundred day moving average price is $80.04. Strategic Education has a 52-week low of $51.01 and a 52-week high of $89.73. The firm has a market cap of $1.16 billion, a PE ratio of 307.06, a price-to-earnings-growth ratio of 0.67 and a beta of 0.51.

Strategic Education (NASDAQ:STRA - Get Free Report) last posted its earnings results on Thursday, November 5th. The health services provider reported $1.72 EPS for the quarter, missing analysts' consensus estimates of $1.95 by ($0.23). Strategic Education had a return on equity of 8.98% and a net margin of 10.46%. The business had revenue of $325.07 million during the quarter, compared to the consensus estimate of $326.55 million. During the same period in the previous year, the business posted $1.64 EPS. The firm's revenue for the quarter was up 1.6% on a year-over-year basis. Research analysts predict that Strategic Education will post 7.23 EPS for the current fiscal year.

Institutional Investors Weigh In On Strategic Education

Several hedge funds have recently made changes to their positions in STRA. Axiom Investment Management LLC purchased a new position in Strategic Education in the first quarter valued at about $25,000. Heritage Family Offices LLP acquired a new position in shares of Strategic Education during the 3rd quarter worth about $25,000. Rockefeller Capital Management L.P. lifted its stake in Strategic Education by 305.3% during the fourth quarter. Rockefeller Capital Management L.P. now owns 616 shares of the health services provider's stock worth $49,000 after purchasing an additional 464 shares during the last quarter. Allworth Financial LP bought a new stake in Strategic Education in the second quarter worth approximately $49,000. Finally, Public Employees Retirement System of Ohio bought a new stake in shares of Strategic Education during the 2nd quarter worth $51,000. Institutional investors and hedge funds own 93.27% of the company's stock.

Strategic Education News Roundup

Here are the key news stories impacting Strategic Education this week:

• Positive Sentiment: Strategic Education declared a quarterly dividend of $0.60 per share, equivalent to $2.40 annually and a reported yield of 4.5%. The ex-dividend date is November 30, and payment is scheduled for December 7.
• Neutral Sentiment: Third-quarter revenue rose 1.6% year over year to $325.1 million, supported by Education Technology Services and higher U.S. Higher Education revenue per student, but was slightly below analyst expectations. Strategic Education Q3 results
• Negative Sentiment: Adjusted expectations were not met: Q3 EPS of $1.72 fell short of consensus estimates around $1.92–$1.95. Coverage also highlighted a $134 million Torrens writedown, a significant drag on the results and a likely source of investor concern. Strategic Education Q3 earnings and writedown
• Negative Sentiment: Barrington Research lowered its rating on STRA from “outperform” to “market perform,” signaling less optimism about the shares. Barrington Research ratings
• Negative Sentiment: Ademi LLP said it is investigating potential securities-fraud claims involving the company. This is an investigation announcement, not a finding of wrongdoing, but it adds a legal and reputational uncertainty for investors. Ademi LLP investigation announcement

About Strategic Education

Strategic Education, Inc NASDAQ: STRA is an education services company that provides postsecondary programs through Strayer University and Capella University. Its institutions serve working adults and other nontraditional students through online and campus-based learning options.

Strayer University offers undergraduate and graduate degree programs, professional certificates and other career-focused educational programs in areas such as business, information technology, health services and criminal justice.

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