Why Strategic Education stock is back in focus after its latest quarterly update

Strategic Education (STRA) is back on investor radars after reporting higher second quarter and first half 2026 sales and net income, alongside record employer enrollment and margin expansion.

The latest earnings, buyback activity and affirmed dividend appear to have supported sentiment around Strategic Education, with the share price at $84.88 and a 90 day share price return of 9.37%, while the 1 year total shareholder return is 13.10%.

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Bulls point to Strategic Education’s higher earnings, record employer enrollment and ongoing buybacks. Bears focus on Australia related legal uncertainty and mixed segment trends. Do recent numbers and the current share price look like fair value or are they mispriced?

Most Popular Narrative: 13.7% Undervalued

Compared with the most followed fair value estimate of $98.33, Strategic Education’s last close at $84.88 sits at a clear discount that the narrative tries to explain.

Strategic Education is benefiting from strong enrollment growth, particularly through its corporate partnerships, which could drive continued revenue growth as employer-affiliated enrollment increased by 16% in 2024. The Education Technology Services segment is experiencing significant growth, with revenue increasing by more than 30% in 2024, primarily through the Sophia Learning direct-to-consumer portal and expanding corporate partnerships, potentially boosting earnings.

Want to see why this fair value sits above today’s price? The narrative refers to compounding earnings, firmer margins and a future earnings multiple that underpins that $98.33 figure.

Result: Fair Value of $98.33 (UNDERVALUED)

However, you still need to factor in regulatory changes in Australia and New Zealand, as well as pressure on revenue per student, which could challenge the bullish Strategic Education narrative.

Next Steps

With sentiment around Strategic Education turning more positive, this is a good time to look through the numbers yourself and decide how convincing the story feels. To see what investors view as the main bright spots, take a closer look at the 4 key rewards.

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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.