STRA
Strategic Education, Inc.
$81.39
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 19.6% below fair value
You pay
$81.39
Bear
$83.39
Fair
$101.25
Bull
$119.12
Bear
$83.39
+2.5%
$6.20 × 14x P/E
Fair
$101.25
+24.4%
$6.20 × 17x P/E
Bull
$119.12
+46.4%
$6.20 × 20x P/E
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
13.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $88.67 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $101.25 per share.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples