Can these educational stocks keep going higher?

Investing.com -- While many education stocks have performed well this year, analysts at BMO Capital Markets think the rally may not be over.

In a new preview of the sector, BMO said “we expect solid results from most of our coverage” and have raised target prices across postsecondary names, including Adtalem Global Education (new price target: $172), Laureate Education ($35), Grand Canyon Education ($245) and Strategic Education ($100), as well as ed-tech firms Coursera ($13) and Stride ($164).

While investors remain focused on potential regulatory shifts from the One Big Beautiful Bill Act (OBBBA), BMO said that “most of the potential impacts — both positive and negative — do not start until 2026.”

The firm also noted that “fears of state budget cuts may not be as severe as expected,” even if risks could rise next year.

In childcare, BMO said Bright Horizons continues to benefit from improving utilization as more employees return to offices, though seasonality will cap near-term gains.

“While we believe BFAM deserves its premium valuation, KLC’s discount may be a bit too severe,” the analysts said, referring to KinderCare.

For K-12 education, BMO highlighted Stride’s outlook after the company guided for “10–15% FY2026 enrollment growth on top of FY2025’s 20.4% year-over-year increase.”

Among postsecondary firms, enrollment growth is said to be “solid though slowing,” and new student loan rules under the OBBBA could become a headwind in 2026. Still, BMO said the group remains “acyclical or even countercyclical,” offering defensive exposure.

Meanwhile, Coursera could benefit from “increased interest in AI-related coursework,” while McGraw Hill may recover after a weak debut as publishing cycles turn next year.

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