What Does Wall Street Think About KinderCare Learning Companies (KLC)?

KinderCare Learning Companies (NYSE:KLC) is one of the best consumer defensive stocks with more than 50% upside. KinderCare Learning Companies (NYSE:KLC) received a rating update from Morgan Stanley analyst Toni Kaplan on October 24, who slashed the price target on the stock to $11 from $14 while keeping an Overweight rating on the shares.

The analyst told investors in a preview for its group coverage on daycare that the firm anticipates enrollment to be the primary focus again in Q3 in a year where enrollment has been “largely overwhelmed.”

Kaplan added that KinderCare Learning Companies (NYSE:KLC) is currently undervalued and is trading at a considerable discount compared to its peers. While key metrics such as pricing and enrollment growth have underperformed, the firm sees potential for their stabilization despite the anticipated seasonal drop in occupancy during fiscal Q3.

In addition, KinderCare Learning Companies (NYSE:KLC) was downgraded to Neutral from Buy by Goldman Sachs analyst George Tong on October 15. The analyst also slashed the price target on the stock to $6 from 20, stating that the stock’s upside is anticipated to be limited due to slowing revenue growth and declining child care center occupancy rates.

Tong further stated that KinderCare’s (NYSE:KLC) remediation efforts are “likely complex and protracted in nature” because the company’s occupancy declines are attributable to local market dynamics instead of a single factor.

KinderCare Learning Companies (NYSE:KLC) provides community-based early childhood education centers, with programs ranging from infant, toddler, and preschool to kindergarten and before- and after- school programs. The company has operations under the KinderCare brand.

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Disclosure: None. This article is originally published at Insider Monkey.