The education stock gained on solid third-quarter earnings results.
Shares of Stride (LRN 8.64%), a K-12 and adult education company, were climbing today after it posted better-than-expected results in its third-quarter earnings report.
As of 11:40 a.m. ET, the stock was up 8.2%.
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Stride takes a step forward
Stride, which provides K-12 education through its K12 brand and serves adult learners with training in healthcare and technology skills, said revenue in the third quarter rose 10.7% to $520.8 million, which topped estimates at $507.2 million.
Enrollment trends continued to move in the right direction with general education up 8.7% to 124.6 million and career learning up 9.8% to 73.8 million.
On the bottom line, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped 16% to $120.5 million, and earnings per share rose 23% to $1.60, which topped expectations at $1.43.
What’s next for Stride
Investors responded favorably to the balanced growth across the K-12 and adult learning sides of the business and were also pleased with the margin expansion.
Looking ahead, the company also raised its full-year forecast to revenue of $2.025-$2.04 billion, up from a previous range of $1.99-$2.04 billion. It also hiked its adjusted operating income outlook to $280 million-$290 million from its earlier range of $265 million-$285 million.
Based on the solid quarterly results and the guidance hike, it’s not surprising to see Stride moving higher today. The education stock also benefits from a modest valuation, as it trades at a price-to-earnings ratio of 16.
Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
