Stride, Inc. (LRN) Balances Federal Investigations With Strong Underlying Business Momentum

We recently compiled a list of the 13 Best Bear Market Stocks to Buy Right Now. Stride, Inc. is one of them.

Stride, Inc. (NYSE:LRN) is an education technology company offering online learning platforms through virtual and blended public schools in the U.S., with a focus on personalized learning and career education programs such as coding bootcamps and apprenticeships.

In September 2025, Stride, Inc. (NYSE:LRN) faced significant legal and regulatory challenges. The Gallup-McKinley County Schools Board of Education filed a complaint alleging fraud, deceptive practices, and systemic violations related to enrollment reporting and student services. The complaint claims Stride inflated enrollment numbers with “ghost students,” used insufficiently licensed teachers, and prioritized profits over compliance and educational quality. The allegations triggered federal securities investigations and caused LRN’s stock to drop approximately 11% in heavy trading.

Shareholder rights firms Hagens Berman and Glancy Prongay & Murray LLP have also launched investigations on behalf of investors, examining whether LRN misled shareholders and adequately disclosed these risks. Despite these setbacks, Stride, Inc. (NYSE:LRN)’s underlying business performance remains strong, making it one of the more resilient picks among the best bear market stocks.

Stride, Inc. (LRN) Balances Federal Investigations With Strong Underlying Business Momentum

Despite these setbacks, Stride, Inc. (NYSE:LRN)’s underlying business performance remains strong. In Q4 FY25, the company reported 22.4% revenue growth year-over-year and over 20% increase in student enrollments, largely driven by career learning programs. Before the legal developments, the firm’s stock had been on a solid upward trajectory, reflecting consistent growth in the online education market.

While we acknowledge the risk and potential of LRN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LRN and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.