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Are Investors Undervaluing Stride (LRN) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Stride (LRN - Free Report) is a stock many investors are watching right now. LRN is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 15.89, which compares to its industry's average of 19.18. Over the last 12 months, LRN's Forward P/E has been as high as 16.33 and as low as 12.10, with a median of 13.66.

We also note that LRN holds a PEG ratio of 0.79. 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. LRN's PEG compares to its industry's average PEG of 1.07. Within the past year, LRN's PEG has been as high as 0.82 and as low as 0.61, with a median of 0.68.

Another notable valuation metric for LRN is its P/B ratio of 3.01. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 3.36. LRN's P/B has been as high as 3.08 and as low as 1.87, with a median of 2.57, over the past year.

These are only a few of the key metrics included in Stride's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, LRN looks like an impressive value stock at the moment.


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