Strayer Education ("STRA") has soared in price over the last week to $113.92, returning just over 25% since I issued a buy recommendation and purchased the stock for the MU Student Investment Fund back in November, when the stock was trading at $91. My initial price target on STRA was $115; therefore, I am temporarily changing my recommendation to a HOLD. However, I anticipate good news from the upcoming fourth quarter earnings release.
Pending an analysis of STRA's fourth quarter numbers, I do not recommend adding to a current position in the stock. The stock still has strong upside and I will likely raise my price target in the coming months as I incorporate a rosier picture into my pricing model. Strayer continues to invest in new campuses despite stronger regulations pressuring industry growth. Also, enrollment, along with margins, have been stronger then anticipated.
I will release an updated recommendation after the fourth quarter earnings release.
-Scott Thelen
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment