Let's see how these fab four look in my Quantum Edge system…
May 29, 2025
School’s Out, and Education Stocks Are In
BY JASON BODNER, EDITOR, QUANTUM EDGE PRO
Around the country, school is out for the summer…
But for investors, it may just be getting started.
Education companies are among the highest-rated stocks in my Quantum Edge system right now.
When I see stocks in the same industry or subgroup all over my screens, it’s usually the sign of an accelerating trend – and that Big Money has set its sights on stocks in that trend.
That’s the case right now with education companies, which have the wind at their back on several fronts.
One is deregulation. The federal government has reduced oversight with President Donald Trump trying to close the Department of Education. A federal judge last week blocked the executive order – at least for now – but whatever ultimately happens, regulation and oversight will decrease the next four years.
More importantly, demand has surged not just for regular schooling but for vocational training and career and technical education in areas like health care, technology, cybersecurity, and skilled trades. Continuing education and training for employees is also more important than ever as technology marches forward.
Education stocks are hot right now, and they are showing up in my quant data. Four of the top 10 stocks in my Retail/Consumer category are educational services companies. In a year when the S&P 500 is up less than 1%, these four stocks have gained 31% on average.
Let’s see how these fab four look in my Quantum Edge system…
Source: TradeSmith Finance
Stride (LRN) has been on fire pretty much since late October. Shares have soared 48% in 2025 and 117% the last 12 months.
Stride is a technology-based education company that provides online and blended learning programs, proprietary and third-party curriculums, software systems, and educational and career learning.
Given the stock’s powerful surge, it’s no surprise that Big Money has eagerly bought shares. I see 14 green bars already in 2025 – signals that show unusually heavy accumulation. There were massive inflows early in the year followed by a break in the market turmoil, and then buy signals reemerged last month.
Source: MoneyFlows.com
I recommended LRN in my Quantum Edge Pro service last October right after a blowout earnings report and fresh Big Money buy signals. Shares are up 66% since then, and with the strong Fundamental and 82.8 Quantum Score, higher prices are likely.
That 91.2 Technical Score is actually a little hot. Scores over 90 often signal a short-term pullback, but LRN has consolidated above $150 much of May, so this could be more of a pause than a pullback.
Source: TradeSmith Finance
Laureate Education (LAUR) has been around more than 20 years and blends in-person and digital learning programs across Mexico and Peru for more than 470,000 students.
Shares are up 22% in 2025 and 40% over the last year, hitting their all-time high earlier this month. That gives it a high Technical Score of 88.2, which is close to overbought.
The fundamentals are solid, with sales growing 13.1% on average the last three years while earnings averaged 130.8% growth. The company keeps 19 cents of every dollar it brings in for a healthy profit margin, and debt is a tad high but still acceptable at 44% of equity.
LAUR shares are 86.1% owned by institutions, and my system picked up three green bars this month, which signal unusually heavy inflows.
That overall Quantum Score of 84.5 puts it at the upper limit of my buy zone. The long-term potential is good, but these shares are also on the verge of getting overheated in the short term.
Source: TradeSmith Finance
Universal Technical Institute (UTI) provides vocational training for in-demand careers in transportation, skilled trades, and health care education. Its Quantum Score is 81.0, which is in the buy zone, but with some caveats.
Drilling down into the data, that Technical Score above 90 is once again higher than I’d like to see, and the Fundamental Score of 66.7 is good but a tad below ideal (above 70).
The biggest red flag is debt. UTI carries much more debt than the other companies at 113.3% of equity. Its profit margin is also lower at 5.3%. The fundamentals aren’t bad compared to the whole market, but they don’t measure up with the rest of the group.
Still, shares have gained 41% in 2025 and 119% the last 12 months, and I see six inflow signals in May. The big boys are back to buying.
Source: TradeSmith Finance
Perdoceo Education (PRDO) runs the gamut with online, campus, and hybrid learning programs for professional development all the way up to doctorate degrees. The company uses various technologies like adaptive learning platforms and mobile apps.
PRDO’s Quantum Score sits at a buyable 79.3, but once again, the technicals show some froth while the fundamentals are the weakest of the group.
Revenue growth isn’t strong enough to make this an elite stock. Sales fell 4% last year and have stayed mostly flat the last three years. Earnings have done a little better, thanks to a 21.7% profit margin.
The hot technicals combined with lower fundamentals move this one to the bottom of the list for me.
Schools may be taking a summer break, but education stocks are still going strong. With Big Money flowing in, deregulation setting the stage, and demand for career-focused learning on the rise, these companies earn high marks in my system.
If you’re looking to stay ahead of the curve, whether you’re in school or not, smart investors would do well to look at the best education stocks. By analyzing money flows, we can see that’s what the pros are doing.
Talk soon,
Jason Bodner Editor, Quantum Edge Pro
Note from Ashley Cassell, Managing Editor, TradeSmith Daily: If all this talk of alternative-education companies is new and surprising for you, there’s a good reason for that. The labor market has dramatically changed in a short time, and job seekers are often finding that skills and availability matter more than credentials. No wonder traditional colleges are losing ground while career-training companies like the ones Jason highlighted above are trending.
I found the implications of all this pretty staggering in the MegaTrends issue that first brought it to my attention, where brothers Andy and Landon Swan go so far as to call this “The Collapse of College.” But this is what their MegaTrends research service is all about. Because they’ve built a huge database of online consumer activity, they can spot emerging trends like the shift in education before the mainstream media catches on… and particularly the financial media.
In their April report on “The Collapse of College,” the Swans identified three companies positioned to benefit from this shift – one of which has been in their portfolio since January 2024 and has more than doubled in the past year.
That particular stock is already well above the recommended buy-up-to price – however, the other two are currently on the Swans’ watchlist. So now is the perfect time to become a MegaTrends subscriber and learn more about the hottest trends in education and elsewhere.
