LRN

Stride is firing on every cylinder a fundamental investor cares about. FY2025 revenue grew 17.9% to $2.41B while net income jumped 41.0% to $288M — operating leverage that took operating margin to 15.0% and net margin to 12.0% from prior-year levels embedded in the history table (FY2024 net margin ~10.0%, FY2023 ~6.9%). Five-year revenue has nearly doubled from $1.54B (FY2021) to $2.41B, while net income has 4x'd from $71.5M to $288M — that is a structural step-up in profitability, not a one-off. Operating cash flow of $433M (+55.2%) materially exceeds reported net income, capex is a trivial $1.78M, and cash & equivalents surged 56.3% to $782M against just $416M of long-term debt — net cash, debt/equity of 0.55x, and ROE of 19.5%. This is a capital-light compounder.

The valuation does not reflect any of this. At $84.81 the stock trades at 14.3x trailing diluted EPS of $5.95 and 1.5x sales for a business growing earnings 41% — a PEG well under 0.5. Market cap of $3.70B is backed by $782M of cash (21% of cap), implying an enterprise value closer to 10x earnings. That is what you pay for a no-growth utility, not a business that just printed 17.9% top-line and 44.3% operating-income growth.