Why These 5 Education Stocks Are Poised for Sustained Growth as the Sector Transforms

The education stocks market is entering a critical inflection point. After years of challenges, for-profit education companies are experiencing a genuine revival, driven by structural changes in how America approaches workforce development, technological innovation, and skills training. For investors seeking exposure to this reshaping industry, 2026 presents compelling opportunities—particularly for those willing to look beyond traditional higher education narratives.

What makes this moment distinct is the convergence of multiple tailwinds. Rising interest in career-focused pathways, government support for alternative credentialing, persistent labor shortages in healthcare and technology, and the strategic deployment of digital tools are combining to create a more favorable backdrop for education stocks than existed just 18 months ago. The Zacks Schools industry—comprising 18 for-profit education providers—now ranks #32 among 250+ Zacks industries, placing it in the top 13% for near-term prospects.

The Education Stocks Sector Is Reshaping: Three Powerful Drivers

Workforce-Oriented Programs Are Replacing Degree-Centric Thinking

The seismic shift in labor market preferences has fundamentally altered demand patterns for education stocks. Employers increasingly value job-ready credentials over traditional four-year degrees, pushing students toward accelerated programs in healthcare, cybersecurity, electrical trades, HVAC, welding, and IT. For-profit educators have capitalized on this transition far more effectively than traditional institutions, leveraging their operational flexibility to launch and scale short-term credentials quickly.

Government policy is reinforcing this trend. Congress passed the Workforce Pell initiative in mid-2025, which took effect July 1, 2026, expanding federal aid eligibility to high-quality, outcomes-verified certificates—a structural expansion of addressable markets for education stocks with accredited programs in healthcare, IT, and skilled trades. Additionally, healthcare institutions facing acute worker shortages have partnered with for-profit providers to address training gaps, creating a demand tailwind that shows no signs of abating.

Digital Innovation Separates Leaders from Followers

Education stocks with robust technology investments are winning market share. Companies like Grand Canyon Education, Stride Inc., and others have invested heavily in learning management systems, adaptive learning platforms, and data analytics tools that personalize instruction and improve student outcomes. The shift toward hybrid and asynchronous learning isn’t merely a pandemic artifact—it’s now fundamental to attracting working adults and non-traditional learners who represent a growing share of enrollment.

Scalable digital platforms also provide a competitive moat: they enable education stocks to reduce per-student costs while maintaining quality, protecting margins during enrollment fluctuations. The selective integration of generative AI—for admissions optimization, personalized tutoring, and operational efficiency—represents the next frontier for differentiation among education stocks.

Consolidation Is Concentrating Advantages Among Larger Players

Larger, better-capitalized education stocks are acquiring niche or financially weaker competitors to expand program offerings and improve operational leverage. Strategic Education’s acquisition of technology bootcamps and Adtalem’s integration of Walden University exemplify this trend. Consolidation in education stocks is creating scale benefits that strengthen competitive positioning while broadening the product range for better-resourced providers.

Why These Education Stocks Offer Better Value Than the Broader Market

On valuation metrics, education stocks present a compelling opportunity relative to both the S&P 500 and the broader Consumer Discretionary sector. The Schools industry trades at 15.32x forward 12-month earnings compared to the S&P 500’s 22.76x and the sector average of 20.44x. This discount reflects both the sector’s historical volatility and current market underappreciation of the structural improvements underway.

Over the past 12 months, education stocks in the Zacks group gained 20.6% collectively—trailing the Consumer Discretionary sector’s 26.6% but outperforming the S&P 500’s 16.2% return. The gap between education stocks’ valuation multiple and its relative performance suggests room for multiple expansion as investors recognize the improving fundamentals and reduced regulatory uncertainty.

Analyst confidence in education stocks earnings is rising. Since April 2025, the industry’s earnings estimates for 2025 increased to $1.34 per share from $1.32, reflecting management execution and analyst upgrades. The top 50% of Zacks-ranked industries historically outperform the bottom 50% by more than 2-to-1, and education stocks’ positioning in the top quartile is a leading indicator.

5 Top Education Stocks to Add to Your Portfolio Now

Below are five education stocks currently carrying Zacks Rank #1 (Strong Buy) or #2 (Buy) designations:

Grand Canyon Education, Inc. (LOPE): Broad-Based Enrollment Momentum Across All Channels

Grand Canyon Education operates five higher education institutions across the United States and dominates the online market. The company’s performance reflects diversified growth across online, hybrid, and ground-based learning models. Online enrollment rose approximately 10% in Q2 2025, driven by continuous program expansion (20+ new programs annually) and deepening partnerships with 5,500+ employers to address workforce shortages. The hybrid channel is accelerating, with enrollment up mid-teens excluding teach-out sites, powered by an “advanced standing” funnel that moves students through affordable eight-week online prerequisites into high-completion nursing cohorts (90% first-time NCLEX pass rates).

LOPE carries a Zacks Rank #1 and has surged 42.1% over the past year. Recent upward earnings revisions pushed 2025 estimates to $9.07 per share from $8.75 within 30 days, implying 12.8% earnings growth. The company has beaten consensus estimates in all trailing four quarters with an average surprise of 4%, and the three-to-five-year earnings growth rate is projected at 15%. Its VGM Score of B supports continued upside potential.

Laureate Education, Inc. (LAUR): Latin America’s Growth Engine

Headquartered in Miami, Laureate operates institutions across Mexico and Peru, where strong demand for employability-focused education and favorable macroeconomic conditions support accelerating growth. Enrollment momentum is particularly strong in fully online working-adult programs, while disciplined pricing and operational efficiencies are boosting profitability. Currency tailwinds and cost controls further strengthen financial results. Expansion plans—including new campuses in Monterrey and Lima—position the company to capture rising regional demand.

LAUR carries a Zacks Rank #2 and has rallied 76.6% over the past year. Upward earnings revisions increased 2025 estimates to $1.73 per share from $1.70 in the past 30 days. This implies 28.2% earnings growth—among the highest in the education stocks peer set. The company’s strong regional brands, digital infrastructure, and supportive regulatory backdrop continue to drive trajectory.

Stride, Inc. (LRN): School-Choice Tailwinds Meet AI-Powered Differentiation

Stride is a technology-forward education services provider with a diversified portfolio spanning K-12 and post-secondary programs. The company’s momentum reflects strong application volumes and enrollment growth driven by secular demand for school-choice alternatives. Management is investing in high-impact differentiation, including high-dosage reading intervention for early grades, expanded career-learning pathways, and cautious AI integration to enhance outcomes. State-level funding support remains favorable, with no material federal headwinds on the horizon.

LRN carries a Zacks Rank #2 and has surged 107.8% over the past year. Fiscal 2026 earnings revisions moved to $8.52 per share from $7.76 within 30 days, implying 5.2% growth. The company has beaten consensus in three of the trailing four quarters with average surprise of 98.7%, and three-to-five-year earnings growth is pegged at 20% with a favorable VGM Score of A.

Lincoln Educational Services Corporation (LINC): Skilled-Trades Training Meets Expansion Opportunities

Based in New Jersey, Lincoln benefits from surging demand for hands-on skilled-trades training as a practical alternative to four-year degrees. The company’s program concentration in fields with persistent labor shortages—electrical, HVAC, automotive, welding, nursing—provides defensive growth. The proprietary “Lincoln 10.0” hybrid model improves flexibility for students while enhancing instructional efficiency and space utilization. Deeper high school pipelines and expanded employer partnerships (including Johnson Controls) are driving enrollment and quality metrics.

LINC carries a Zacks Rank #2 and has surged 59.5% over the past year. Recent earnings revisions increased 2025 estimates to 67 cents per share from 63 cents, implying 19.6% growth. The company has beaten consensus in three of trailing four quarters (average surprise: 74.1%), and three-to-five-year expected earnings growth is 15% with a favorable VGM Score of A.

Perdoceo Education Corporation (PRDO): Scale, Diversification, and Strategic M&A

Perdoceo operates postsecondary programs across online, campus-based, and blended formats through three main brands (CTU, AIU, University of St. Augustine). Strong enrollment momentum across all platforms is supported by high retention and rising prospect interest. The recent University of St. Augustine acquisition meaningfully expands scale, particularly in hybrid and health-science segments. Investments in technology, analytics, and support systems continue improving outcomes and capacity, while AIU’s extra December session bolsters near-term enrollment.

PRDO carries a Zacks Rank #2 and has risen 44.7% over the past year. Recent earnings revisions increased 2025 estimates to $2.52 per share from $2.49, implying 10% growth. The company has beaten consensus in all trailing four quarters with average surprise of 6.2%, and three-to-five-year earnings growth is pegged at 15% with a favorable VGM Score of B.

The Path Forward for Education Stocks

For investors, education stocks represent a compelling intersection of valuation attractiveness, improving fundamentals, and structural tailwinds. The policy environment has shifted—government now explicitly supports alternative credentials and workforce development. Employers are hiring for skills, not just credentials. Technology is making education delivery more flexible and cost-effective. These factors suggest the current education stocks valuations may not reflect the sector’s true earnings power over the next 18-24 months.

The key risks—funding dependency, regulatory scrutiny, and affordability concerns—remain material. However, demographic trends (growing older and minority learner segments), sustained state and federal support for vocational education, and ongoing digital innovation are providing multiple paths to enrollment and revenue growth. For growth-oriented portfolios seeking exposure to a sector in structural transition, the five education stocks highlighted above offer differentiated stories backed by executed growth and upward estimate revisions.