STRA

Strategic Education Inc

TMT


Presented:07/14/2020
Price:$153.31
Cap:$3.41B
Current Price:$88.75
Cap:$2.19B

Presented

Date07/14/2020
Price$153.31
Market Cap$3.41B
Ent Value$2.72B
P/E Ratio32.3x
Book Value$65.69
Div Yield1.5%
Shares O/S22.21M
Ave Daily Vol210,597
Short Int5.87%

Current

Price$88.75
Market Cap$2.19B
Strategic Education, Inc. engages in the provision of educational services. It operates through the following segments: Strayer University, Capella University, and Non-Degree Programs. The Strayer University segment includes programs offered through the Jack Welch Management Institute. The company was founded in 1892 and is headquartered in Herndon, VA.

Publicly traded companies mentioned herein: Strategic Education Inc (STRA)

Highlights

The presenter is long shares of Strategic Education (STRA), fka Strayer (the name was changed after the completion of the $1.9B Capella acquisition in 2018). STRA’s online education model should be sustainable given all the pressure on higher education as a result of COVID-19, and with the stock in the $150s, the risk/reward setup is favorable. The company has $25/share of cash on the balance sheet, there is potential for Capella's growth to exceed expectations, and the current dividend yield is ~1.5%. Based on this he believes the stock deserves at least a 20x multiple to his forward earnings estimate, which implies a target price of >$170 within the next 12 months. 

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Idea Discussion

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