Yahoo Finance Stride, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
As you might know, Stride, Inc. (NYSE:LRN) just kicked off its latest quarterly results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 2.6% to hit US$521m. Stride reported statutory earnings per share (EPS) US$1.60, which was a notable 14% above what the analysts had forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Stride
Taking into account the latest results, the most recent consensus for Stride from four analysts is for revenues of US$2.19b in 2025. If met, it would imply a solid 10% increase on its revenue over the past 12 months. Per-share earnings are expected to swell 15% to US$5.00. Before this earnings report, the analysts had been forecasting revenues of US$2.17b and earnings per share (EPS) of US$4.66 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target was unchanged at US$73.75, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Stride analyst has a price target of US$77.00 per share, while the most pessimistic values it at US$70.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Stride's revenue growth is expected to slow, with the forecast 8.1% annualised growth rate until the end of 2025 being well below the historical 15% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 11% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Stride.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Stride's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Stride's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Stride. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Stride going out to 2026, and you can see them free on our platform here..
We also provide an overview of the Stride Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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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.
