Oppenheimer analyst Brian Schwartz maintained a Buy rating on 2U Inc (NASDAQ: TWOU) today and set a price target of $91. The company’s shares closed yesterday at $80.21.
Schwartz noted:
“2U’s business had a good second quarter, and several data points in the report could challenge the short case with: 1) the business outlook (and FCEs) expected to reaccelerate organically to mid-30%+ revenue growth in 2H:2018 and 2019; 2) GetSmarter’s 2019 growth outlook is above Street expectations; 3) no DGP contract renewal until 2024; and 4) bullish pipeline commentary. Negatively, DGP ARPU shrank in the 1H:2018 owing to mix and tough comparisons and leaves a tough optic. While 2U’s valuation currently reflects a meaningfully successful business trajectory over the FTM, we believe TWOU should be a core long-term holding as the most-dominant and best-positioned vendor for the future within higher education. The company has deep structural advantages, and many prestigious universities as referenceable partners for competitive differentiation. Reiterate Outperform.”
According to TipRanks.com, Schwartz is a top 25 analyst with an average return of 28.1% and a 79.0% success rate. Schwartz covers the Technology sector, focusing on stocks such as Ultimate Software, Instructure Inc, and Salesforce.com.
The word on The Street in general, suggests a Strong Buy analyst consensus rating for 2U Inc with a $99.83 average price target, representing a 24.5% upside. In a report issued on July 31, Barrington also reiterated a Buy rating on the stock.
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The company has a one-year high of $98.58 and a one-year low of $45.50. Currently, 2U Inc has an average volume of 712K.
Based on the recent corporate insider activity of 45 insiders, corporate insider sentiment is negative on the stock.
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2U, Inc. provides cloud-based software-as-a-service solutions for nonprofit colleges and universities to deliver education to qualified students. The firm’s cloud-based SaaS platform solutions include online campus, an online learning platform that enables its clients to offer educational content together with instructor-led classes in a live, intimate, and engaging setting through proprietary Web-based and mobile applications; and content management system, which enables its clients to author, review and deploy asynchronous content into their online programs. Its solutions also comprise application processing portal that automates the online application process for prospective students of its client’s programs; and customer relationship management deployments, which serve as the data hub for scheduling, student acquisition, student application, faculty admissions review, enrollment and student support for each program. The company was founded by Christopher J. Paucek in April 2008 and is headquartered in Lanham, MD.
