NRDY

Nerdy Inc($NRDY) CEO's $25M Contrarian Bet During Stock Collapse Sparks Recovery Hopes for EdTech

05/28/2025 21:40

Nerdy Inc ($NRDY) CEO Charles Cohn has captured market attention with approximately $25 million in aggressive share purchases over the past year, with the most striking being a $12 million buying spree during the stock's August 2024 collapse. Nerdy operates as a small-cap online tutoring and educational services company with a market capitalization of approximately $255 million. While online education demand surged during the COVID-19 pandemic, the sector has faced normalization pressures as students return to in-person learning. The stock's journey tells a volatile story: shares fell from around $1.80 in June 2024 to a low of $0.83 in early August before gradually recovering to current levels around $1.63. Notably, Cohn's most aggressive purchases coincided precisely with this dramatic decline. Examining Cohn's buying pattern reveals remarkable conviction. In June 2024, he purchased 2.1 million shares worth $3.7 million across five consecutive trading days. Then, during the August crash, he acquired 13.2 million shares for $12.1 million in just two days, averaging around $0.90 per share. Additional significant purchases continued through November and December 2024. Contrasting this bullish insider activity, CFO Jason Pello and CLO Christopher Swenson have been regular sellers, primarily through programmed sales and tax-related transactions. Their May 16, 2025 simultaneous sales appear linked to restricted stock unit vesting and associated tax obligations. The company's financial performance remains challenging. Recent quarterly results show persistent losses and declining revenues. Q1 2025 reported a 6-cent per share loss, though this beat analyst expectations of a 13-cent loss. Revenue trends have been declining, reflecting broader industry headwinds. The online education sector faces post-pandemic normalization as demand that spiked during lockdowns has cooled. Competition has intensified with new market entrants, while traditional in-person education has regained favor. Many edtech companies are struggling with similar challenges of maintaining growth rates achieved during the pandemic. Despite these headwinds, Cohn's aggressive purchasing suggests strong management confidence in the company's long-term value proposition. His willingness to deploy significant personal capital during the stock's lowest point demonstrates conviction in Nerdy's fundamental prospects. Analyst sentiment remains cautious, with current consensus ratings at 'hold' and a median 12-month price target of $2.00, implying approximately 23% upside from current levels. The educational technology sector retains long-term growth potential driven by digital transformation and personalized learning trends, though near-term challenges persist. Investors should weigh the positive signal from CEO buying against the company's current financial struggles and broader sector dynamics. The significant insider purchases during market weakness could indicate an attractive entry point, but requires careful consideration of execution risks in a challenging operating environment.

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