Have you been paying attention to shares of
Coursera (? Shares have been on the move with the stock up 25.8% over the past month. The stock hit a new 52-week high of $16.8 in the previous session. Coursera has gained 41.6% since the start of the year compared to the 8.4% move for the Zacks Business Services sector and the 16.1% return for the Zacks Technology Services industry. COUR Quick Quote COUR - Free Report) What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on July 27, 2023, Coursera reported EPS of $0 versus consensus estimate of $-0.1 while it beat the consensus revenue estimate by 5.48%.
For the current fiscal year, Coursera is expected to post earnings of -$0.11 per share on $620.92 million in revenues. This represents a 70.27% change in EPS on a 18.55% change in revenues. For the next fiscal year, the company is expected to earn $0.04 per share on $713.32 million in revenues. This represents a year-over-year change of 134.55% and 14.88%, respectively.
Coursera may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Coursera has a Value Score of F. The stock's Growth and Momentum Scores are A and C, respectively, giving the company a VGM Score of B.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Coursera currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Coursera meets the list of requirements. Thus, it seems as though Coursera shares could have potential in the weeks and months to come.
How Does COUR Stack Up to the Competition?
Shares of COUR have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is
Trane Technologies plc (. TT has a Zacks Rank of # 2 (Buy) and a Value Score of C, a Growth Score of B, and a Momentum Score of C. TT Quick Quote TT - Free Report)
Earnings were strong last quarter. Trane Technologies plc beat our consensus estimate by 5.10%, and for the current fiscal year, TT is expected to post earnings of $8.82 per share on revenue of $17.58 billion.
Shares of Trane Technologies plc have gained 3.7% over the past month, and currently trade at a forward P/E of 22.84X and a P/CF of 22.61X.
The Technology Services industry is in the top 43% of all the industries we have in our universe, so it looks like there are some nice tailwinds for COUR and TT, even beyond their own solid fundamental situation.