Activist Jeff Ubben thinks the market is mistakenly underappreciating Strategic Education because it is a for-profit education company.
His firm, Inclusive Capital, has a more than 5% stake in Strategic Education. Since early June, the stock is down more than 40%, while the S&P 500 has rallied more than 12%.
For-profit education companies have gotten a bad reputation in recent years, but Ubben thinks Strategic Education can provide strong returns by leveraging its technology capabilities. Additionally, the company has undertaken initiatives aimed at reducing the cost of post-secondary education.
Company: Strategic Education Inc. (STRA)
Business: Strategic Education is a for-profit education services company that provides post-secondary education and other academic programs, through its subsidiaries, Strayer University, New York Code and Design Academy (NYCDA) and Capella Education Company. As of Dec. 31, 2019, the University offered 53 degree programs with 128 graduate and undergraduate specializations in business administration, accounting, information technology, education, nursing, public administration and criminal justice at 77 physical campuses located in the mid-Atlantic and southern regions of the United States, and online. The University also offers an executive Master of Business Administration online through its Jack Welch Management Institute.