K12 (LRN) Gains But Lags Market: What You Should Know
K12 (LRN) closed at $33.48 in the latest trading session, marking a +0.78% move from the prior day.
K12 (LRN) closed the most recent trading day at $33.48, moving +0.78% from the previous trading session. This move lagged the S&P 500's daily gain of 1.42%. At the same time, the Dow added 1.82%, and the tech-heavy Nasdaq gained 0.61%.
Heading into today, shares of the online education company had lost 10.22% over the past month, lagging the Consumer Discretionary sector's loss of 9.86% and the S&P 500's loss of 2.09% in that time.
K12 will be looking to display strength as it nears its next earnings release. On that day, K12 is projected to report earnings of $0.77 per share, which would represent year-over-year growth of 28.33%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $395.35 million, up 5.1% from the year-ago period.
LRN's full-year Zacks Consensus Estimates are calling for earnings of $2.05 per share and revenue of $1.58 billion. These results would represent year-over-year changes of +19.88% and +2.85%, respectively.
Investors might also notice recent changes to analyst estimates for K12. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. K12 is holding a Zacks Rank of #2 (Buy) right now.
Valuation is also important, so investors should note that K12 has a Forward P/E ratio of 16.18 right now. Its industry sports an average Forward P/E of 17.69, so we one might conclude that K12 is trading at a discount comparatively.
It is also worth noting that LRN currently has a PEG ratio of 0.81. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Schools stocks are, on average, holding a PEG ratio of 0.79 based on yesterday's closing prices.
The Schools industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 225, which puts it in the bottom 12% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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