JPMorgan Names 2 EdTech Stocks With Upside Potential

Investing.com -- The online education sector continues to evolve amid changing market conditions, with leading platforms adapting their strategies to drive growth. JPMorgan’s recent analysis highlights two key players in this space - Coursera and Udemy - both facing similar challenges but implementing distinct approaches to navigate the current landscape.

JPMorgan maintains a Neutral rating on both companies, with different price targets reflecting their individual market positions and growth prospects.

These platforms are leveraging artificial intelligence, expanding content offerings, and refining their business models to improve financial performance despite headwinds in certain segments.

Coursera (Neutral, $12 PT)

JPMorgan projects Coursera’s revenue growth at approximately 8% year-over-year in Q3, aligning with the company’s guidance of 7-9%. For full-year 2025, analysts expect 7% growth, consistent with Coursera’s 6-7% guidance range.

Despite CFO Ken Hahn’s upcoming departure, the company has maintained its outlook, though JPMorgan anticipates potential upside to Q3 guidance.

Website metrics show improvement with global visits declining at a slower rate of 6% year-over-year in Q3 compared to 10% in Q2. Global downloads surged 52% year-over-year according to Sensor Tower data, significantly outpacing Q2’s 24% growth.

The company’s product innovations, including Coach, Course Builder, and AI translations, along with content growth of 36% year-over-year, could drive stronger performance.

JPMorgan expects Coursera’s 2025 adjusted EBITDA margin of 8.2% to exceed the company’s 8.0% guidance. The firm’s $12 price target is based on approximately 11x 2027 estimated free cash flow of $117 million.

In recent developments, Coursera announced it has become one of the first learning platforms integrated directly into OpenAI’s ChatGPT. Following the news, Cantor Fitzgerald maintained its Overweight rating and $13.00 price target on the company.

Udemy (Neutral, $9 PT)

For Udemy, JPMorgan forecasts Q3 revenue of $193 million, representing a 1% year-over-year decline on a constant currency basis, within the company’s guidance range of $190-195 million. Full-year 2025 revenue is projected at $791 million, a 1% increase year-over-year.

While website traffic metrics remain challenged with global visits down 11% year-over-year in Q3, Udemy is showing positive signs in its enterprise segment. The company generated its highest volume of $100,000+ pipeline deals since 2022 during Q2, and Team Plan bookings grew over 35% year-over-year.

Udemy’s consumer subscription model is gaining traction, with subscription GMV growing approximately 50% year-over-year in July. The company has reached 250,000+ consumer subscribers, a figure expected to double to around 500,000+ in 2026.

JPMorgan projects Udemy’s 2025 adjusted EBITDA at $87 million, representing an 11.1% margin and 560 basis points improvement year-over-year.

The firm’s $9 price target for Udemy is based on approximately 8.5x 2027 estimated free cash flow of $106 million.

Udemy reported second-quarter 2025 earnings and revenue that surpassed analyst forecasts. Subsequently, Cantor Fitzgerald raised its price target on the company to $10.00 from $9.00, while Canaccord Genuity reiterated its Buy rating.

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