Spotting Winners: Laureate Education (NASDAQ:LAUR) And Education Services Stocks In Q2

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how education services stocks fared in Q2, starting with Laureate Education (NASDAQ:LAUR).

A whole industry has emerged to address the problem of rising education costs, offering consumers alternatives to traditional education paths such as four-year colleges. These alternative paths, which may include online courses or flexible schedules, make education more accessible to those with work or child-rearing obligations. However, some have run into issues around the value of the degrees and certifications they provide and whether customers are getting a good deal. Those who don’t prove their value could struggle to retain students, or even worse, invite the heavy hand of regulation.

The 8 education services stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady as they are up 4.5% on average since the latest earnings results.

Laureate Education (NASDAQ:LAUR)

Founded in 1998 by Douglas L. Becker and based in Miami, Laureate Education (NASDAQ:LAUR) is a global network of higher education institutions.

Laureate Education reported revenues of $524.2 million, up 5% year on year. This print exceeded analysts’ expectations by 1.5%. Overall, it was a very strong quarter for the company with full-year revenue guidance beating analysts’ expectations and an impressive beat of analysts’ adjusted operating income estimates.

Eilif Serck-Hanssen, President and Chief Executive Officer, said “We are pleased with the solid operating results for the second quarter and are increasing our full year outlook following an improvement in foreign currency rates. Laureate remains on track with its strategic priorities, including the opening of two new campuses this September. Our balance sheet and cash flow generation are strong, and we remain committed to supporting our growth initiatives while returning excess capital to our shareholders.”

Laureate Education scored the highest full-year guidance raise of the whole group. Unsurprisingly, the stock is up 21.9% since reporting and currently trades at $27.85.

Is now the time to buy Laureate Education? Access our full analysis of the earnings results here, it’s free.

Best Q2: Lincoln Educational (NASDAQ:LINC)

Established in 1946, Lincoln Educational (NASDAQ:LINC) is a provider of specialized technical training in the United States, offering career-oriented programs to provide practical skills required in the workforce.

Lincoln Educational reported revenues of $116.5 million, up 13.2% year on year, outperforming analysts’ expectations by 0.5%. The business had a very strong quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 18.4% since reporting. It currently trades at $19.38.

Is now the time to buy Lincoln Educational? Access our full analysis of the earnings results here, it’s free.

Perdoceo Education (NASDAQ:PRDO)

Formerly known as Career Education Corporation, Perdoceo Education (NASDAQ:PRDO) is an educational services company that specializes in postsecondary education.

Perdoceo Education reported revenues of $209.6 million, up 25.7% year on year, exceeding analysts’ expectations by 1.3%. It was a satisfactory quarter as it also posted a decent beat of analysts’ EBITDA estimates but EPS guidance for next quarter missing analysts’ expectations.

Interestingly, the stock is up 14.2% since the results and currently trades at $32.92.

Read our full analysis of Perdoceo Education’s results here.

Grand Canyon Education (NASDAQ:LOPE)

Founded in 1949, Grand Canyon Education (NASDAQ:LOPE) is an educational services provider known for its operation at Grand Canyon University.

Grand Canyon Education reported revenues of $247.5 million, up 8.8% year on year. This print surpassed analysts’ expectations by 2.8%. Overall, it was a very strong quarter as it also logged an impressive beat of analysts’ adjusted operating income estimates and EPS guidance for next quarter exceeding analysts’ expectations.

The stock is up 18.5% since reporting and currently trades at $204.27.

Read our full, actionable report on Grand Canyon Education here, it’s free.

Strategic Education (NASDAQ:STRA)

Formed through the merger of Strayer Education and Capella Education in 2018, Strategic Education (NASDAQ:STRA) is a career-focused higher education provider.

Strategic Education reported revenues of $321.5 million, up 2.9% year on year. This number missed analysts’ expectations by 0.6%. More broadly, it was a satisfactory quarter as it also produced a decent beat of analysts’ EBITDA estimates but .

Strategic Education had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is up 3% since reporting and currently trades at $81.96.

Read our full, actionable report on Strategic Education here, it’s free.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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