EdTech Evolution: 3 Stocks Educating the Next Generation – InvestorPlace

Get these EdTech stocks to prepare for shifts in the education industry

Source: fizkes / Shutterstock.com

Education is a core pillar of a vibrant society, and the industry continues to evolve. Technology has made educational resources more accessible for many people. Its possible to access a library of online information, complete college degrees online and attend live classes.

Any industry with rising demand and a pathway for innovation can reward investors who get in early. Even some of the most established EdTech stocks offer many opportunities. Investors looking to profit from tech in education may want to load up on these three stocks.

Source: Postmodern Studio / Shutterstock.com

Coursera(NYSE:COUR) partners with colleges, universities and companies to offer educational resources. The company makes money through a monthly subscription. The company also receives a percentage of every tuition payment made through the platform.

Coursera has had a rocky start since its IPO and is down by almost 60% from its all-time high. However, a company that disappoints shortly after its IPO isnt necessarily a bad investment. Shares have catapulted 60% year-to-date resulting in a $3 billion market cap.

Coursera achieved21% year-over-year revenue growthand minimized its net losses in the third quarter. A notable trend investors should monitor is thedecline of college enrollmentswhich had been going on before the pandemic.

Its easy to see why enrollments are down. Students get straddled into high debt, and a degree doesnt offer the same guarantees as it did in the past. Coursera makes the path to a career more affordable.

The platform also features European universities which have lower tuition fees than their American counterparts. Some companies even accept certifications that demonstrate expertise in a certain subject. Coursera should benefit as more people turn away from universities.

Source: IgorGolovniov / Shutterstock.com

Even with innovation in the education industry, students and teachers often go back to popular resources. When most people have questions, they go to Google to find the answer. Google is one of the many companies under the Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) umbrella. The company also owns YouTube.

These two search engine juggernauts command plenty of attention. Google receives a mind-boggling89.3 billion visits per month, and that doesnt include YouTube. That type of reach allows Google to run ads and command high asking prices.

Alphabet isnt only making money with advertising. The company also uses Google Cloud to power many websites. Its suite of online products like Gmail and Google Docs are popular resources for students and teachers.

Alphabet has become a critical player in education technology. The company continues to innovate and generate healthy profit margins for investors. Shares have gained 58% year-to-date and are up by 173% over the past five years.

Source: dennizn / Shutterstock

Duolingo(NASDAQ:DUOL) is a mobile app and website that helps people learn new languages. Its the go-to app for the immersive experience it provides. Students are required to write and speak in the language they want to learn.

Duolingo has over83 million monthly active userswhich grew by 47% year-over-year. Daily active users jumped by 63% year-over-year to 24.2 million. The high user growth led to an impressive 43% year-over-year revenue growth rate.

Duolingo makes most of its revenue from subscriptions. The company also makes some money from advertising, English tests and a category labeled as Other. This all-encompassing component primarily consists of in-app sales of virtual goods. Total bookings were up by 49% year-over-year which implies a strong finish to the year.

Duolingo is poised to accelerate its revenue growth rates withthe recent addition of music and mathto its flagship app. Music and math expand Duolingos addressable market and can increase the apps average revenue per user.

On this date of publication, Marc Guberti held a long position in DUOL. The opinions expressed in this article are those of the writer, subject to theInvestorPlace.comPublishing Guidelines.

Visit link:

EdTech Evolution: 3 Stocks Educating the Next Generation - InvestorPlace