Contrasting K12 (LRN) & Its Peers

K12 (NYSE: LRN) is one of 20 publicly-traded companies in the “General Education Services” industry, but how does it weigh in compared to its rivals? We will compare K12 to related businesses based on the strength of its earnings, risk, institutional ownership, dividends, profitability, analyst recommendations and valuation.

Analyst Recommendations

This is a breakdown of recent recommendations for K12 and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
K12 0 0 1 0 3.00
K12 Competitors 66 459 474 5 2.42

K12 currently has a consensus target price of $21.00, suggesting a potential upside of 27.43%. As a group, “General Education Services” companies have a potential upside of 6.31%. Given K12’s stronger consensus rating and higher probable upside, research analysts plainly believe K12 is more favorable than its rivals.

Insider and Institutional Ownership

78.6% of K12 shares are owned by institutional investors. Comparatively, 70.7% of shares of all “General Education Services” companies are owned by institutional investors. 18.3% of K12 shares are owned by insiders. Comparatively, 13.9% of shares of all “General Education Services” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares K12 and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
K12 0.70% 4.16% 3.17%
K12 Competitors 0.50% -0.62% 1.77%

Valuation and Earnings

This table compares K12 and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
K12 $888.52 million $450,000.00 109.87
K12 Competitors $897.39 million $60.39 million 6.04

K12’s rivals have higher revenue and earnings than K12. K12 is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

K12 has a beta of -0.27, suggesting that its stock price is 127% less volatile than the S&P 500. Comparatively, K12’s rivals have a beta of 1.17, suggesting that their average stock price is 17% more volatile than the S&P 500.

Summary

K12 beats its rivals on 9 of the 13 factors compared.

K12 Company Profile

K12 Inc. (K12) is a technology-based education company. The Company offers curriculum, software systems and educational services designed to facilitate individualized learning for students in kindergarten through 12th grade (K-12). It provides a continuum of technology-based educational products and solutions to public school districts, public schools, virtual charter schools, private schools and families. The Company offers a set of products and services primarily to three lines of business, which include Managed Public School Programs, which consists of virtual and blended schools; Institutional business, which includes educational products and services sold to school districts, public schools and other educational institutions, and Private Pay Schools and Other, which includes private schools, including international, for which it charges student tuition and direct consumer sales. It sells individual online courses and supplemental educational products directly to families.

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