As I have a natural obsession with global edtechs in both the pre-IPO capital markets and Nasdaq, I believe a tactical trade opportunity is in sight in Coursera (COUR), down from its post IPO high of 62.50. COUR now trades at $5.26 billion market cap or 13.8X its revenue guidance for 2021.
There is no doubt that the pandemic has only accelerated a global trend towards online learning and the outsourcing of corporate training program (is there Udacity beyond audacity) as billions of human beings are forced to grasp the realities of our world’s digital future. Nothing in Coursera’s first post IPO’s earnings or conference call negated this view – in fact, au contraire since YoY revenue growth was a stellar 64% as was the 5 million increase in net new registered learners, who now number 82 million.
While Coursera’s business model and financials are nowhere near as fabulous as Udemy which posted $500 million in revenue in 2020 and is going gangbusters with its Tencent partnership, I still like the risk/reward calculus I can engineer on COUR options on the CBOE. Re-skilling and episodic learning are the hot concepts in Silicon Valley edtech and while Udemy is a pure play on this trend, COUR is also collateral beneficiary.
It thrills me that Coursera and Udemy have democratized access to education on a planetary scale and taken higher learning beyond the reach of financial elites as any cursory examination of Oxbridge, the Ivy League, les grandes écoles and the ridiculously priced second rate minor English public schools recreated in the UAE would suggest.
A trade to help pay for Junior’s obscenely rich expenses at Harvard or the King’s Arms, the most elite of Oxford’s 39 colleges which I know all too well? Feb 2022 40 Puts give me a worst case scenario of owning COUR at $32, just below its March 2021 IPO price when Goldie gave private clients in the Gulf diddly squat as an allocation.
I believe my fare value on COUR is at $50 but will only act after I consult with my twin edtech maestros – Abu Thomas and Brittanicus Memonus, the two coolest and brainest equities nerds I know in the Sandbox.
