Has Stride Found the Formula for a Sustainable School Choice?

Stride, Inc.’s LRN main focus lies in offering online and hybrid education models that align with the growing demand for flexibility, accessibility and personalized learning. In the current education market, students and parents are actively shifting toward virtual education alternatives, AI-based solutions and more career-focused programs. To align with this market trend, the company is undertaking several business initiatives that enable it to capitalize on these trends and diversify its revenue streams.

This Virginia-based education company is actively investing across all its programs, especially on the career platform, and seeking ways to incorporate AI. Its primary focus is on foundational areas and technologies that it can leverage for better customer outcomes and experiences. Moreover, the K12 Tutoring offering is helping LRN become a top choice among other market players. In fiscal 2025, its tutoring services gained traction, with several states in the United States recognizing the importance of tutoring in shaping children throughout K-12 education. To enhance its offerings and increase demand patterns, LRN is currently engaged in integrating AI into its tutoring model.

These efforts and market trends were substantiated by Stride’s fiscal 2025 performance, wherein the average enrollment grew year over year by 20.4%, with the General Education segment’s enrollment rising 13.2% and the same for the Career Learning segment increasing 32.5%. LRN expects enrollment growth of between 10% and 15% year over year for the first quarter of fiscal 2026, positioning it well for fiscal 2026 and beyond.

Thus, if Stride continues to balance innovation with accountability, it may not just benefit from being the top school choice, but it could help redefine sustainable and technology-driven education in the coming years.

Stride’s Competitive Position

Stride faces a dynamic competitive landscape from other renowned market players like Coursera, Inc. COUR and Chegg, Inc. CHGG.

Coursera’s model offers flexibility and global recognition, but Stride’s ability to integrate tutoring and support services across its portfolio has provided stickier enrollment growth, especially in career-oriented pathways. Contrarily, Chegg operates a direct-to-consumer subscription model, offering digital study aids, homework assistance and increasingly, AI-driven tutoring for college and post-secondary learners.

Although Stride appears to hold a competitive edge in its integrated K-12 plus career learning model, Coursera’s scale and academic brand and Chegg’s deep penetration in student support, remain serious rivals.

LRN Stock’s Price Performance & Valuation Trend

Shares of this Virginia-based education company have trended upward 41.1% year to date, outperforming the Zacks Schools industry, the broader Zacks Consumer Discretionary sector and the S&P 500 Index.

LRN stock is currently trading at a premium compared with its industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 16.13, as shown in the chart below.

Earnings Estimate Revision of LRN

LRN’s earnings estimates for fiscal 2026 and fiscal 2027 have moved north over the past 30 days to $8.81 and $9.71 per share, respectively. The revised figures for fiscal 2026 and 2027 imply year-over-year growth of 8.8% and 10.2%, respectively.

Stride stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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