Eric Sheridan, an analyst from Goldman Sachs, reiterated the Sell rating on Coursera (COUR – Research Report). The associated price target is $15.00.
Eric Sheridan has given his Sell rating due to a combination of factors influencing Coursera’s market performance and future outlook. The primary concern stems from the ongoing weakness in Coursera’s Enterprise and Degrees segments, which have not met expectations. Despite Coursera’s Consumer segment showing robust demand for professional certificates and learner growth, the Business side, which accounts for approximately half of the Enterprise segment, is experiencing difficulties. These challenges are attributed to squeezed learning and development budgets and increased competition. Moreover, the Degrees segment is facing headwinds due to a tight labor market, which is dampening near-term demand for Coursera’s offerings.
Sheridan also considers the broader economic environment and its impact on Coursera. While there is acknowledgment of better-than-anticipated margin trajectory due to scale and AI-driven efficiencies, the overall risk/reward profile for Coursera’s stock remains unappealing. The sustainability of Coursera’s business model is under question amid the uncertain pace and scale at which enterprises might adopt generative AI into their systems, and how Coursera’s platform will fit into this evolving landscape. With these factors in mind, Sheridan maintains a cautious stance, reaffirming the Sell rating and modestly increasing the 12-month price target to $15, reflecting the adjustments post-earnings report and management’s commentary.
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Coursera (COUR) Company Description:
Coursera Inc is a global online learning platform that offers anyone, anywhere access to online courses and degrees from world-class universities and companies. It combines content, data, and technology into a single, unified platform that is customizable and extensible to both individual learners and institutions. The platform will contains a catalog of high-quality content and credentials, content developed by leading university and industry partners, data and machine learning drive personalized Learning, effective marketing, and skills Benchmarking and others.
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