In this article, we will look at the 12 Best Education Stocks to Buy in 2025.
Is The Time for the Department of Education Over?
The future of the Department of Education in the US is a significant subject of debate in the education sector, as the Trump administration has already started to close parts of it, with plans to shut it down completely. The Department of Education is a significant body in the country, responsible for distributing college aid, underwriting student loans, and ensuring unhindered access to education for all.
CNBC reported that President Trump campaigned to find and eradicate the “radicals who have infiltrated the federal Department of Education,” nominating Linda McMahon to help improve the department. In a White House press conference on February 4, President Trump said:
“I want Linda to put herself out of a job.”
The US Department of Education was established by former President Jimmy Carter in 1979. Since the Department of Education is an agency authorized by Congress, congressional approval is necessary to shut it down. However, President Trump, Elon Musk, and the DOGE team are continually chipping at it, as reported by CNBC. Experts are of the opinion that although some of the programs administered and managed by the department can be distributed to other agencies, this transition may result in significant disruptions to the country’s $1.6 trillion student loan program.
President Trump’s efforts against the department are facing criticism from experts and US citizens alike. CNBC reported the results of a poll conducted by Data for Progress on behalf of the Student Borrower Protection Center and Groundwork Collaborative, showing that 61% of likely voters were of the opinion that they would oppose the Trump administration’s use of an executive order to abolish the Education Department. Only 34% of respondents approved of this move. The survey of 1,294 people was conducted between January 31 to February 2.
Significant Cuts in the Department of Education Already Underway
Elon Musk’s DOGE team significantly scaled down the Institute of Education Sciences, which is the research wing of the Education Department. In a statement, the American Educational Research Association and the Council of Professional Associations on Federal Statistics said 169 contracts were canceled. Some of the canceled contracts were related to the collection and reporting of education statistics. CNBC reported that Sameer Gadkaree, president and CEO of The Institute for College Access & Success, said the following about the scenario:
“Sensible public policy for education depends on strong research and basic collection and availability of data on institutional performance and student outcomes. Without it, Americans will be in the dark on shifts in debt, student success, and how public dollars should be invested to increase effectiveness.”
CNBC also reported that Tomas Philipson, a professor of public policy studies at the University of Chicago and former acting chair of the White House Council of Economic Advisers, was of the following opinion:
“One of the intents [of the administration’s actions] is to redistribute funding from the federal education department to states and localities. If such a redistribution occurs, this will likely improve, as opposed to hurt, learning as state and locals are better suited to address their heterogeneous needs. The one-size-fits-all nature of federal regulations and spending programs can often be improved upon.”
Shifting the Department of Education’s $1.6 trillion student loan program is not anticipated to be an easy process that may go smoothly by experts. It may have ripples across a current college student body of millions, along with more than 42 million borrowers with federal student loan debt.
With these trends in view, let’s look at the 12 best education stocks to buy in 2025.
A student conducting a self-taught higher education examination in a library.
Our Methodology
We sifted through stock screeners, online rankings, and ETFs to compile a list of 20 education stocks. We then selected the top 12 most popular stocks among elite hedge funds as of Q4 2024. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund sentiment.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Education Stocks to Buy in 2025
12. Strategic Education, Inc. (NASDAQ:STRA)
Number of Hedge Fund Holders: 22
Strategic Education, Inc. (NASDAQ:STRA) is an education services company that provides access to post-secondary education through online and campus-based post-secondary offerings. The company operates through its subsidiaries Strayer University and Capella University, accredited American post-secondary institutions, and Torrens University, an Australian accredited post-secondary institution. Its segments are divided into US Higher Education (USHE), Australia/New Zealand, and Education Technology Services.
The company reported that the percentage of US higher education enrollment stemming from its corporate partnerships rose by 200 basis points to 30% in fiscal Q3 2024. Student retention in US higher education remained stable at 87%. In addition, revenue from US higher education rose 3% in the quarter, while operating income grew 10% compared to last year.
In addition to the US, Strategic Education, Inc. (NASDAQ:STRA) is experiencing solid results in New Zealand and Australia as well, with the segment posting another quarter of total enrollment growth, with enrollment increasing 5% from the prior year to more than 19,000 students. Revenue also increased 11% on a constant currency basis from the prior year in fiscal Q3 2024. This growth was attributed to higher revenue per student and increased enrollment. Strategic Education, Inc. (NASDAQ:STRA) thus has a strong operational model in place. It ranks 12th on our list of the best education stocks to buy in 2025.
11. Laureate Education, Inc. (NASDAQ:LAUR)
Number of Hedge Fund Holders: 23
Laureate Education, Inc. (NASDAQ:LAUR) operates a portfolio of degree-granting Mexican and Peruvian higher education institutions known as the Laureate International Universities network. The network offers a list of graduate and undergraduate degrees through online, in-person, and hybrid programs. The company operates in two segments: Mexico and Peru. In Mexico, it owns the Universidad del Valle de Mexico (UVM) and Universidad Tecnologica de Mexico (UNITEC). In Peru, the company owns Universidad Peruana de Ciencias Aplicadas (UPC), Universidad Privada del Norte (UPN), and CIBERTEC institution. It has around 450,000 students enrolled at five institutes spread across more than 50 campuses.
Laureate Education, Inc. (NASDAQ:LAUR) reported a 3% revenue growth in fiscal Q4 2024 and a 10% revenue growth on an organic constant currency basis. Its operating income also grew to $124.2 million in fiscal Q4 2024, compared to $110.0 million for fiscal Q4 2023. The company’s net income for the quarter reached $93.6 million, compared to net income of $41.7 million for the same quarter last year. This growth was attributed to higher operating income and the effect of changes in foreign currency exchange rates on intercompany balances compared to 2023.
New enrollments in fiscal year 2024 increased by 5%, and total enrollments grew by the same number. These trends reflect the growing popularity and profitability of Laureate Education, Inc. (NASDAQ:LAUR). Management expects to deliver US dollar-reported growth in both adjusted EBITDA and unlevered free cash flow in 2025, supported by its continued margin expansion efforts and robust momentum in local currency revenue growth.
