On Tuesday, Cantor Fitzgerald adjusted its financial outlook on Coursera Inc (NYSE:COUR) shares, a leading online education platform. The firm's analyst decreased the price target to $21.00 from the previous $26.00 while maintaining an Overweight rating.
The revision in Coursera's price target follows a mixed first quarter of 2024 performance and cautious statements from the company's management. As a result, Cantor Fitzgerald has reduced its revenue estimates for fiscal years 2024 and 2025 by 4.5% and 4.0% respectively. Additionally, the firm has also lowered its adjusted EBITDA estimates significantly by 16.1% for FY24 and 20.6% for FY25.
Despite the downward revision, the analyst emphasized that the firm's long-term view on Coursera remains positive. The recent 11% decline in Coursera's stock price during after-hours trading, which brought it to all-time lows, is seen as a potential buying opportunity. This perspective is supported by Coursera's substantial cash reserves, approximated at $725 million, and the belief that Coursera is a pivotal educational platform for the future.
The new price target of $21 is based on a revised target multiple of 4.5 times the 2024 estimated enterprise value to sales ratio, a decrease from the previous multiple of 5.5. Despite the lowered financial estimates and price target, the firm reasserted its Overweight rating, indicating a continued expectation of the stock's performance to be strong relative to the market or its sector.
InvestingPro Insights
As Coursera Inc (NYSE:COUR) navigates through its financial ebbs and flows, real-time data from InvestingPro provides a clearer picture of its current market standing. With a market capitalization of $1.87 billion and a challenging P/E ratio currently at -15.13, the company's financial health is under scrutiny. However, the revenue growth remains a bright spot, with a 19.28% increase over the last twelve months as of Q1 2024, reflecting Coursera's capacity to expand its top-line.
InvestingPro Tips highlight that Coursera holds more cash than debt, a reassuring sign of financial stability. Moreover, the expectation of net income growth this year and the revisions of earnings upwards by 7 analysts for the upcoming period provide a silver lining for potential investors. These insights, coupled with the fact that the stock is considered to be in oversold territory according to the RSI, might suggest an opportune moment for market entry.
For those interested in a deeper dive into Coursera's financials and future prospects, there are additional InvestingPro Tips available. By using the coupon code PRONEWS24, readers can get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking valuable insights that could inform their investment decisions.
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