Strategic Education, Inc.

STRA

Consumer DefensiveEducation & Training ServicesNASDAQ

$77.61

Market Cap: $1.76B

Strategic Education, Inc. (STRA) Valuation Summary

Updated Apr 14, 2026 22:24

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$80.33 – $364.74	$129.68	+63.4%
Growth Exit 10Y	$85.78 – $362.45	$134.42	+69.4%
EBITDA Exit 5Y	$54.25 – $140.85	$93.82	+18.2%
EBITDA Exit 10Y	$65.75 – $156.28	$104.06	+31.1%
▸ Trading Multiples
P/E	$80.29 – $134.92	$81.28	+2.4%
EV/EBITDA	$78.62 – $100.24	$80.80	+1.8%
EV/Revenue	$52.13 – $145.27	$55.07	-30.6%
▸ PEG
PEG Fair Value	$135.50 – $135.50	$135.50	+70.7%
▸ Earnings Power Value
Earnings Power Value	$65.59 – $100.06	$79.17	-0.2%
▸ Dividend Discount
Dividend Discount	$50.21 – $148.73	$78.27	-1.4%

Valuation History

DCF Analysis

Fair Value

$129.68

Market Price

$77.61

Upside / Downside

+67.1%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 2.9% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (84% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $129.68 per share, suggesting STRA is undervalued by 67.1% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	159	166	183	188	194	198
(−) Net Interest	26	27	30	31	32	33
(+) D&A	43	43	44	48	51	52
EBITDA	228	236	257	267	276	283

(−) Tax	48	50	55	57	58	60
(−) CapEx	48	50	55	57	59	60
(−) ΔWC	116	6	15	5	5	5
Free Cash Flow (FCFF)	16	129	132	148	155	159

Terminal Value						3,456
WACC / Discount Rate	7.1%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	15	117	111	117	114	2,454

Enterprise Value	2,928
Projection Period	474	16.2%
Terminal Value	2,454	83.8%

(−) Current Net Debt	(32)

Equity Value	2,959
(/) Outstanding Shares	23

Fair Price	$129.68

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.1%	$174	$199	$233	$283	$365
6.1%	$135	$149	$167	$190	$223
7.1%	$110	$119	$130	$143	$160
8.1%	$93	$99	$106	$114	$124
9.1%	$80	$85	$89	$95	$102

Current price: $77.61. Green = undervalued, Red = overvalued.

Fair Value

$134.42

Market Price

$77.61

Upside / Downside

+73.2%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 3.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (68% of enterprise value) is derived from the Gordon Growth Model on Year 11 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $134.42 per share, suggesting STRA is undervalued by 73.2% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	159	166	183	188	194	199	205	211	217	224	229
(−) Net Interest	26	27	30	31	32	33	34	35	36	37	38
(+) D&A	43	43	44	48	51	54	56	59	61	62	64
EBITDA	228	236	257	267	276	286	295	305	314	323	331

(−) Tax	48	50	55	57	58	60	62	64	65	67	69
(−) CapEx	48	50	55	57	59	60	62	64	66	68	70
(−) ΔWC	116	6	15	5	5	5	5	5	5	6	6
Free Cash Flow (FCFF)	16	129	132	148	155	161	166	172	177	182	186

Terminal Value											4,064
WACC / Discount Rate	7.1%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	15	117	111	117	114	110	106	103	99	95	2,049

Enterprise Value	3,036
Projection Period	987	32.5%
Terminal Value	2,049	67.5%

(−) Current Net Debt	(32)

Equity Value	3,067
(/) Outstanding Shares	23

Fair Price	$134.42

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.1%	$188	$210	$241	$287	$362
6.1%	$145	$158	$173	$193	$222
7.1%	$118	$126	$134	$145	$159
8.1%	$100	$104	$110	$116	$124
9.1%	$86	$89	$93	$97	$102

Current price: $77.61. Green = undervalued, Red = overvalued.

Fair Value

$93.83

Market Price

$77.61

Upside / Downside

+20.9%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 2.9% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (78% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.1x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $93.82 per share, suggesting STRA is undervalued by 20.9% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

EV/EBITDA Exit Multiple

8.13x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	159	166	183	188	194	198
(−) Net Interest	26	27	30	31	32	33
(+) D&A	43	43	44	48	51	52
EBITDA	228	236	257	267	276	283

(−) Tax	48	50	55	57	58	—
(−) CapEx	48	50	55	57	59	—
(−) ΔWC	116	6	15	5	5	—
Free Cash Flow (FCF)	16	129	132	148	155	—

Peers' EBITDA Multiple						8.1x
Terminal Value						2,304
WACC / Discount Rate	7.09%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	15	117	111	117	114	1,636

Enterprise Value	2,109
Projection Period	474	22.4%
Terminal Value	1,636	77.6%

(−) Current Net Debt	(32)
Equity Value	2,141
(÷) Outstanding Shares	23M
Fair Price	$94	+20.9%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.1x	6.1x	8.1x	10.1x	12.1x
5.1%	$63	$83	$102	$121	$141
6.1%	$61	$79	$98	$116	$135
7.1%	$59	$76	$94	$111	$129
8.1%	$56	$73	$90	$107	$124
9.1%	$54	$70	$86	$102	$119

Current price: $77.61. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$104.07

Market Price

$77.61

Upside / Downside

+34.1%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 3.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (58% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.1x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $104.06 per share, suggesting STRA is undervalued by 34.1% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

EV/EBITDA Exit Multiple

8.13x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	159	166	183	188	194	199	205	211	217	224	229
(−) Net Interest	26	27	30	31	32	33	34	35	36	37	38
(+) D&A	43	43	44	48	51	54	56	59	61	62	64
EBITDA	228	236	257	267	276	286	295	305	314	323	331

(−) Tax	48	50	55	57	58	60	62	64	65	67	—
(−) CapEx	48	50	55	57	59	60	62	64	66	68	—
(−) ΔWC	116	6	15	5	5	5	5	5	5	6	—
Free Cash Flow (FCF)	16	129	132	148	155	161	166	172	177	182	—

Peers' EBITDA Multiple											8.1x
Terminal Value											2,691
WACC / Discount Rate	7.09%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	15	117	111	117	114	110	106	103	99	95	1,357

Enterprise Value	2,343
Projection Period	987	42.1%
Terminal Value	1,357	57.9%

(−) Current Net Debt	(32)
Equity Value	2,375
(÷) Outstanding Shares	23M
Fair Price	$104	+34.1%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.1x	6.1x	8.1x	10.1x	12.1x
5.1%	$86	$103	$121	$139	$156
6.1%	$80	$96	$112	$128	$144
7.1%	$75	$89	$104	$119	$133
8.1%	$70	$83	$97	$110	$123
9.1%	$66	$78	$90	$102	$114

Current price: $77.61. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$81.28

Market Price

$77.61

Upside / Downside

+4.7%

Verdict

Undervalued

Using the industry peer median P/E Multiples multiple (trailing + forward), Strategic Education, Inc. (STRA) has a fair value of $81.28 based on 6 comparable companies in the Education & Training Services industry.

P/E Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Strategic Education, Inc.STRA	1,771	14.3x	16.0x
Central Garden & Pet CompanyCENT	2,299	14.5x	13.0x
Perdoceo Education CorporationPRDO	2,253	14.5x	16.5x
Universal Technical Institute, Inc.UTI	1,937	31.2x	33.3x
Weis Markets, Inc.WMK	1,718	19.0x	12.8x
J&J Snack Foods Corp.JJSF	1,553	24.3x	15.8x
Phoenix Education Partners, IncPXED	1,015	7.5x	7.8x
Industry Median		16.7x	14.4x
(*) Profit after tax		127	110
Equity Value		2,120	1,589
(/) Outstanding shares		23	23
Fair Price		$93	$70

Selected Fair Value (avg of trailing + forward)

$81.28

+4.7%

Fair Value

$80.80

Market Price

$77.61

Upside / Downside

+4.1%

Verdict

Undervalued

Using the industry peer median EV/EBITDA multiple (trailing + forward), Strategic Education, Inc. (STRA) has a fair value of $80.80 based on 7 comparable companies in the Education & Training Services industry.

EV/EBITDA Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Strategic Education, Inc.STRA	1,771	7.7x	8.0x
McGraw Hill, Inc.MH	2,575	8.1x	8.2x
Central Garden & Pet CompanyCENT	2,299	8.0x	8.0x
Perdoceo Education CorporationPRDO	2,253	8.4x	10.0x
Universal Technical Institute, Inc.UTI	1,937	14.2x	14.3x
Weis Markets, Inc.WMK	1,718	7.8x	5.8x
J&J Snack Foods Corp.JJSF	1,553	10.0x	10.0x
Phoenix Education Partners, IncPXED	1,015	4.6x	4.7x
Industry Median		8.1x	8.2x
(*) EBITDA		226	218
= Enterprise Value		1,836	1,789
(-) Net Debt		-32	-32
Equity Value		1,867	1,820
(/) Outstanding shares		23	23
Fair Price		$82	$80

Selected Fair Value (avg of trailing + forward)

$80.80

+4.1%

Fair Value

$55.07

Market Price

$77.61

Upside / Downside

-29.0%

Verdict

Overvalued

Using the industry peer median EV/Revenue multiple (trailing + forward), Strategic Education, Inc. (STRA) has a fair value of $55.07 based on 8 comparable companies in the Education & Training Services industry.

EV/Revenue Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Strategic Education, Inc.STRA	1,771	1.4x	1.4x
McGraw Hill, Inc.MH	2,575	2.6x	2.6x
Central Garden & Pet CompanyCENT	2,299	0.9x	0.9x
Perdoceo Education CorporationPRDO	2,253	2.6x	3.1x
Universal Technical Institute, Inc.UTI	1,937	2.5x	2.5x
Weis Markets, Inc.WMK	1,718	0.4x	0.3x
J&J Snack Foods Corp.JJSF	1,553	1.0x	1.0x
Phoenix Education Partners, IncPXED	1,015	0.9x	0.9x
Coursera, Inc.COUR	1,006	0.3x	0.3x
Industry Median		1.0x	1.0x
(*) Revenue		1,268	1,224
= Enterprise Value		1,244	1,206
(-) Net Debt		-32	-32
Equity Value		1,276	1,238
(/) Outstanding shares		23	23
Fair Price		$56	$54

Selected Fair Value (avg of trailing + forward)

$55.07

-29.0%

PEG Fair Value

Fair Value

$135.50

Market Price

$77.61

Upside / Downside

+74.6%

Verdict

Undervalued

Using the PEG framework with historical EPS growth of 25.0% plus 3.2% dividend yield, the company has a fair value of $135.50 based on TTM EPS (FY2025) of $5.42. The current PEG ratio is 0.54.

PEG Ratio

0.54Deep Value

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 14.6 ÷ (24.2% + 3.2%) = 0.54

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Fast GrowerPEG highly applicable

PEG is most informative for high-growth companies — the PEG sweet spot.

Fair Value Calculation

EPS Growth RateHistorical	24.2%
Dividend Yield	+3.2%
Adjusted Growth (clamped 8–25%)Clamped	25.0%
Fair P/E	25.0x
TTM EPS (FY2025)	$5.42
Fair Value	$135.50

Growth Analysis

Forward Growth

No analyst estimates available.

Historical GrowthActive

Year	Net Income	EPS	YoY
FY2021	$55.1M	$2.28	—
FY2022	$46.7M	$1.94	-14.9%
FY2023	$69.8M	$2.91	+50.0%
FY2024	$112.7M	$4.67	+60.5%
FY2025	$126.6M	$5.42	+16.1%

4Y Historical EPS CAGR: 24.2%

Earnings Power Value

Fair Value

$79.17

Market Price

$77.61

Upside / Downside

+2.0%

Verdict

Undervalued

Using the Earnings Power Value framework with a WACC of 7.1% and normalized earnings of $125.8M, the company has a fair value of $79.17 per share. The EPV range is $65.59 – $100.06 based on WACC sensitivity (5.6% – 8.6%).

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	126	126	126
(/) WACC	8.6%	7.1%	5.6%
Enterprise Value	1,465	1,775	2,252
(-) Net debt	-32	-32	-32
Equity Value	1,497	1,807	2,283
(/) Outstanding shares	23	23	23
Fair Price	$65.59	$79.17	$100.06

Dividend Discount Model

Fair Value

$78.27

Market Price

$77.61

Upside / Downside

+0.9%

Verdict

Undervalued

Using the Two-Stage Dividend Discount Model with a Cost of Equity of 7.3% and projected dividend growth of 11.0%, the fair value is $78.27 per share. The DDM range is $50.21 – $148.73 based on sensitivity analysis across Cost of Equity and growth rate assumptions.

Dividend Profile

Current DPS

$2.52

Dividend Yield

3.19%

Payout Ratio

45.4%

Dividend Coverage

2.20x

FCF Payout Ratio37.4%

DPS CAGR (4Y)0.7%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$2.52	45.4%	+3.2%
2024	$2.44	52.3%	-0.4%
2023	$2.45	84.2%	-0.6%
2022	$2.47	126.9%	+0.8%
2021	$2.45	107.2%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$2.80	11.0%	0.9323	$2.61
2027	$3.11	11.0%	0.8691	$2.70
2028	$3.45	11.0%	0.8102	$2.79
2029	$3.83	11.0%	0.7553	$2.89
2030	$4.25	11.0%	0.7042	$2.99
Terminal Value	$4.35 DPS	2.5%		$64.29

PV of Projected Dividends$13.98

PV of Terminal Value$64.29

Fair Value per Share$78.27

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	9.0%	10.0%	11.0%	12.0%	13.0%
5.3%	$125	$131	$137	$143	$149
6.3%	$91	$95	$100	$104	$108
7.3%	$72	$75	$78	$82	$85
8.3%	$59	$62	$64	$67	$70
9.3%	$50	$52	$55	$57	$59

Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.

Strategic Education, Inc. (STRA) Valuation Summary

Updated Apr 14, 2026 22:24

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$80.33 – $364.74	$129.68	+63.4%
Growth Exit 10Y	$85.78 – $362.45	$134.42	+69.4%
EBITDA Exit 5Y	$54.25 – $140.85	$93.82	+18.2%
EBITDA Exit 10Y	$65.75 – $156.28	$104.06	+31.1%
▸ Trading Multiples
P/E	$80.29 – $134.92	$81.28	+2.4%
EV/EBITDA	$78.62 – $100.24	$80.80	+1.8%
EV/Revenue	$52.13 – $145.27	$55.07	-30.6%
▸ PEG
PEG Fair Value	$135.50 – $135.50	$135.50	+70.7%
▸ Earnings Power Value
Earnings Power Value	$65.59 – $100.06	$79.17	-0.2%
▸ Dividend Discount
Dividend Discount	$50.21 – $148.73	$78.27	-1.4%

Valuation History

DCF Analysis

Fair Value

$129.68

Market Price

$77.61

Upside / Downside

+67.1%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	159	166	183	188	194	198
(−) Net Interest	26	27	30	31	32	33
(+) D&A	43	43	44	48	51	52
EBITDA	228	236	257	267	276	283

(−) Tax	48	50	55	57	58	60
(−) CapEx	48	50	55	57	59	60
(−) ΔWC	116	6	15	5	5	5
Free Cash Flow (FCFF)	16	129	132	148	155	159

Terminal Value						3,456
WACC / Discount Rate	7.1%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	15	117	111	117	114	2,454

Enterprise Value	2,928
Projection Period	474	16.2%
Terminal Value	2,454	83.8%

(−) Current Net Debt	(32)

Equity Value	2,959
(/) Outstanding Shares	23

Fair Price	$129.68

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.1%	$174	$199	$233	$283	$365
6.1%	$135	$149	$167	$190	$223
7.1%	$110	$119	$130	$143	$160
8.1%	$93	$99	$106	$114	$124
9.1%	$80	$85	$89	$95	$102

Current price: $77.61. Green = undervalued, Red = overvalued.

Fair Value

$134.42

Market Price

$77.61

Upside / Downside

+73.2%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	159	166	183	188	194	199	205	211	217	224	229
(−) Net Interest	26	27	30	31	32	33	34	35	36	37	38
(+) D&A	43	43	44	48	51	54	56	59	61	62	64
EBITDA	228	236	257	267	276	286	295	305	314	323	331

(−) Tax	48	50	55	57	58	60	62	64	65	67	69
(−) CapEx	48	50	55	57	59	60	62	64	66	68	70
(−) ΔWC	116	6	15	5	5	5	5	5	5	6	6
Free Cash Flow (FCFF)	16	129	132	148	155	161	166	172	177	182	186

Terminal Value											4,064
WACC / Discount Rate	7.1%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	15	117	111	117	114	110	106	103	99	95	2,049

Enterprise Value	3,036
Projection Period	987	32.5%
Terminal Value	2,049	67.5%

(−) Current Net Debt	(32)

Equity Value	3,067
(/) Outstanding Shares	23

Fair Price	$134.42

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.1%	$188	$210	$241	$287	$362
6.1%	$145	$158	$173	$193	$222
7.1%	$118	$126	$134	$145	$159
8.1%	$100	$104	$110	$116	$124
9.1%	$86	$89	$93	$97	$102

Current price: $77.61. Green = undervalued, Red = overvalued.

Fair Value

$93.83

Market Price

$77.61

Upside / Downside

+20.9%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 2.9% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (78% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.1x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $93.82 per share, suggesting STRA is undervalued by 20.9% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

EV/EBITDA Exit Multiple

8.13x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	159	166	183	188	194	198
(−) Net Interest	26	27	30	31	32	33
(+) D&A	43	43	44	48	51	52
EBITDA	228	236	257	267	276	283

(−) Tax	48	50	55	57	58	—
(−) CapEx	48	50	55	57	59	—
(−) ΔWC	116	6	15	5	5	—
Free Cash Flow (FCF)	16	129	132	148	155	—

Peers' EBITDA Multiple						8.1x
Terminal Value						2,304
WACC / Discount Rate	7.09%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	15	117	111	117	114	1,636

Enterprise Value	2,109
Projection Period	474	22.4%
Terminal Value	1,636	77.6%

(−) Current Net Debt	(32)
Equity Value	2,141
(÷) Outstanding Shares	23M
Fair Price	$94	+20.9%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.1x	6.1x	8.1x	10.1x	12.1x
5.1%	$63	$83	$102	$121	$141
6.1%	$61	$79	$98	$116	$135
7.1%	$59	$76	$94	$111	$129
8.1%	$56	$73	$90	$107	$124
9.1%	$54	$70	$86	$102	$119

Current price: $77.61. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$104.07

Market Price

$77.61

Upside / Downside

+34.1%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Strategic Education, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 2.6% to 3.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 22, DPO 29, DIO 60). At a 7.1% WACC with mid-year discounting, the terminal value (58% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 8.1x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $104.06 per share, suggesting STRA is undervalued by 34.1% at the current price of $77.61.

FCFF Present Value Calculation

WACC

7.09%

3% – 20%

EV/EBITDA Exit Multiple

8.13x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	159	166	183	188	194	199	205	211	217	224	229
(−) Net Interest	26	27	30	31	32	33	34	35	36	37	38
(+) D&A	43	43	44	48	51	54	56	59	61	62	64
EBITDA	228	236	257	267	276	286	295	305	314	323	331

(−) Tax	48	50	55	57	58	60	62	64	65	67	—
(−) CapEx	48	50	55	57	59	60	62	64	66	68	—
(−) ΔWC	116	6	15	5	5	5	5	5	5	6	—
Free Cash Flow (FCF)	16	129	132	148	155	161	166	172	177	182	—

Peers' EBITDA Multiple											8.1x
Terminal Value											2,691
WACC / Discount Rate	7.09%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	15	117	111	117	114	110	106	103	99	95	1,357

Enterprise Value	2,343
Projection Period	987	42.1%
Terminal Value	1,357	57.9%

(−) Current Net Debt	(32)
Equity Value	2,375
(÷) Outstanding Shares	23M
Fair Price	$104	+34.1%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	4.1x	6.1x	8.1x	10.1x	12.1x
5.1%	$86	$103	$121	$139	$156
6.1%	$80	$96	$112	$128	$144
7.1%	$75	$89	$104	$119	$133
8.1%	$70	$83	$97	$110	$123
9.1%	$66	$78	$90	$102	$114

Current price: $77.61. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$81.28

Market Price

$77.61

Upside / Downside

+4.7%

Verdict

Undervalued

P/E Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Strategic Education, Inc.STRA	1,771	14.3x	16.0x
Central Garden & Pet CompanyCENT	2,299	14.5x	13.0x
Perdoceo Education CorporationPRDO	2,253	14.5x	16.5x
Universal Technical Institute, Inc.UTI	1,937	31.2x	33.3x
Weis Markets, Inc.WMK	1,718	19.0x	12.8x
J&J Snack Foods Corp.JJSF	1,553	24.3x	15.8x
Phoenix Education Partners, IncPXED	1,015	7.5x	7.8x
Industry Median		16.7x	14.4x
(*) Profit after tax		127	110
Equity Value		2,120	1,589
(/) Outstanding shares		23	23
Fair Price		$93	$70

Selected Fair Value (avg of trailing + forward)

$81.28

+4.7%

Fair Value

$80.80

Market Price

$77.61

Upside / Downside

+4.1%

Verdict

Undervalued

EV/EBITDA Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Strategic Education, Inc.STRA	1,771	7.7x	8.0x
McGraw Hill, Inc.MH	2,575	8.1x	8.2x
Central Garden & Pet CompanyCENT	2,299	8.0x	8.0x
Perdoceo Education CorporationPRDO	2,253	8.4x	10.0x
Universal Technical Institute, Inc.UTI	1,937	14.2x	14.3x
Weis Markets, Inc.WMK	1,718	7.8x	5.8x
J&J Snack Foods Corp.JJSF	1,553	10.0x	10.0x
Phoenix Education Partners, IncPXED	1,015	4.6x	4.7x
Industry Median		8.1x	8.2x
(*) EBITDA		226	218
= Enterprise Value		1,836	1,789
(-) Net Debt		-32	-32
Equity Value		1,867	1,820
(/) Outstanding shares		23	23
Fair Price		$82	$80

Selected Fair Value (avg of trailing + forward)

$80.80

+4.1%

Fair Value

$55.07

Market Price

$77.61

Upside / Downside

-29.0%

Verdict

Overvalued

EV/Revenue Valuation — Education & Training Services

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Strategic Education, Inc.STRA	1,771	1.4x	1.4x
McGraw Hill, Inc.MH	2,575	2.6x	2.6x
Central Garden & Pet CompanyCENT	2,299	0.9x	0.9x
Perdoceo Education CorporationPRDO	2,253	2.6x	3.1x
Universal Technical Institute, Inc.UTI	1,937	2.5x	2.5x
Weis Markets, Inc.WMK	1,718	0.4x	0.3x
J&J Snack Foods Corp.JJSF	1,553	1.0x	1.0x
Phoenix Education Partners, IncPXED	1,015	0.9x	0.9x
Coursera, Inc.COUR	1,006	0.3x	0.3x
Industry Median		1.0x	1.0x
(*) Revenue		1,268	1,224
= Enterprise Value		1,244	1,206
(-) Net Debt		-32	-32
Equity Value		1,276	1,238
(/) Outstanding shares		23	23
Fair Price		$56	$54

Selected Fair Value (avg of trailing + forward)

$55.07

-29.0%

PEG Fair Value

Fair Value

$135.50

Market Price

$77.61

Upside / Downside

+74.6%

Verdict

Undervalued

Using the PEG framework with historical EPS growth of 25.0% plus 3.2% dividend yield, the company has a fair value of $135.50 based on TTM EPS (FY2025) of $5.42. The current PEG ratio is 0.54.

PEG Ratio

0.54Deep Value

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 14.6 ÷ (24.2% + 3.2%) = 0.54

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Fast GrowerPEG highly applicable

PEG is most informative for high-growth companies — the PEG sweet spot.

Fair Value Calculation

EPS Growth RateHistorical	24.2%
Dividend Yield	+3.2%
Adjusted Growth (clamped 8–25%)Clamped	25.0%
Fair P/E	25.0x
TTM EPS (FY2025)	$5.42
Fair Value	$135.50

Growth Analysis

Forward Growth

No analyst estimates available.

Historical GrowthActive

Year	Net Income	EPS	YoY
FY2021	$55.1M	$2.28	—
FY2022	$46.7M	$1.94	-14.9%
FY2023	$69.8M	$2.91	+50.0%
FY2024	$112.7M	$4.67	+60.5%
FY2025	$126.6M	$5.42	+16.1%

4Y Historical EPS CAGR: 24.2%

Earnings Power Value

Fair Value

$79.17

Market Price

$77.61

Upside / Downside

+2.0%

Verdict

Undervalued

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	126	126	126
(/) WACC	8.6%	7.1%	5.6%
Enterprise Value	1,465	1,775	2,252
(-) Net debt	-32	-32	-32
Equity Value	1,497	1,807	2,283
(/) Outstanding shares	23	23	23
Fair Price	$65.59	$79.17	$100.06

Dividend Discount Model

Fair Value

$78.27

Market Price

$77.61

Upside / Downside

+0.9%

Verdict

Undervalued

Dividend Profile

Current DPS

$2.52

Dividend Yield

3.19%

Payout Ratio

45.4%

Dividend Coverage

2.20x

FCF Payout Ratio37.4%

DPS CAGR (4Y)0.7%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$2.52	45.4%	+3.2%
2024	$2.44	52.3%	-0.4%
2023	$2.45	84.2%	-0.6%
2022	$2.47	126.9%	+0.8%
2021	$2.45	107.2%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$2.80	11.0%	0.9323	$2.61
2027	$3.11	11.0%	0.8691	$2.70
2028	$3.45	11.0%	0.8102	$2.79
2029	$3.83	11.0%	0.7553	$2.89
2030	$4.25	11.0%	0.7042	$2.99
Terminal Value	$4.35 DPS	2.5%		$64.29

PV of Projected Dividends$13.98

PV of Terminal Value$64.29

Fair Value per Share$78.27

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	9.0%	10.0%	11.0%	12.0%	13.0%
5.3%	$125	$131	$137	$143	$149
6.3%	$91	$95	$100	$104	$108
7.3%	$72	$75	$78	$82	$85
8.3%	$59	$62	$64	$67	$70
9.3%	$50	$52	$55	$57	$59