Learn CW Investment Corporation (LCW) Stock

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Contributor, Benzinga
October 11, 2021
$10.93
-0.005[-0.05%]
Last update: 8:12AM (Delayed 15-Minutes)
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Open10.940Close10.940
Vol / Avg.10.931K / 70.734KMkt Cap164.916M
Day Range10.930 - 10.94052 Wk Range10.300 - 11.540

Beyond the horrifying health risks associated with the SARS-CoV-2 virus that continues to hinder the U.S. and other nations, government officials have worried about the pandemic’s lingering, potentially generational impact. Specifically, millions of young students in their formative years suffered an unforeseen setback. Worse yet, the U.S. Department of Education warned that COVID-19 has imposed disparate pressures on underprivileged communities.

While the temptation exists to blame the global health crisis on the challenges squeezing American education, the reality is that social researchers have been analyzing this brewing contradiction between U.S. economic dominance versus its educational laggardness for decades. However, prior contrarian arguments suggested that continued dominance is enough to not be overly concerned with American students’ testing performance relative to international benchmarks.

Eventually, though, this argument may not hold water. Among the paradigm shifts that have occurred is the rise of China and the vitality of the eastern hemisphere. To address this competitive concern, educational technology (EdTech) platforms hold significant potential, thereby boosting interest in the initial public offering (IPO) of academics-focused Learn CW Investment Corporation.

When Is the Learn CW Investment Corporation IPO Date?

LCW IPO’’d on October 8, 2021 at a value of $10 per stock.

Learn CW Investment Corporation Financial History

Because Learn CW Investment is still in the seek-and-merge phase, no other financial details regarding LCW stock exist besides its IPO funding. In this case, the blank-check firm is offering 20 million shares at a per-unit price of $10. Providing the sole bookrunning service is Evercore (NYSE: EVR), which has a 45-day option to purchase 3 million shares at $10 each to cover any overallotments.

While the above information doesn’t provide any other insights, prospective buyers of LCW stock can extrapolate the equity unit’s possible upside over the next several years. According to Learn CW’s prospectus with the U.S. Securities and Exchange Commission (SEC), it puts a heavy focus on the EdTech industry. Indeed, the term EdTech appears 32 times in the prospectus.

Specifically, Learn CW cites forecasting data from HolonIQ — billed as the world's leading impact intelligence platform — which estimates that the education solutions market (both traditional and digital) reached a valuation of $5.4 trillion worldwide in 2020. Therefore, the blank-check firm’s sponsors believe that EdTech’s total addressable market (TAM) is both robust and burgeoning. In 2025, HolonIQ projects total education revenue to hit $7.3 trillion, or a 6% compound annual growth rate between 2020 and 2025.

As for EdTech specifically, HolonIQ’s research suggests that this sector will grow 150% between 2019 to 2025, reaching $404 billion in total worldwide expenditure. But even at this lofty level, the spending will only represent 5.5% of the $7.3 trillion forecast in 2025. Thus, the compelling narrative for LCW stock is that the EdTech industry continues to grab market share from traditional academic arenas — with Learn CW’s eventual business combination hopefully leading the charge.

To be completely transparent, anybody can come up with a forecast, so due diligence is a must before deciding on LCW stock. Nevertheless, other expert sources reasonably corroborate HolonIQ’s optimism. For instance, Grand View Research indicates that by the end of 2021, the EdTech market will command a valuation of $106 billion. By 2028, this segment’s total revenue should be nearly $378 billion, within 6.5% of HolonIQ’s forecast.

On the flipside, you should be aware that SPACs post-merger are dilutive vehicles, leading to underperformance against benchmark indices in the year thus far. Also, SPACs may feature conflicts of interest as sponsors are compensated to broker deals, not necessarily good deals.

Learn CW Investment Corporation Potential

While Learn CW Investment at this point is a purely aspirational investment, should the SPAC find a viable EdTech merger candidate, the long-term opportunities appear limitless. For one thing, the Biden administration has proposed various initiatives to bolster the U.S. academic infrastructure through government funds and other critical resources. Though presidential administrations are transitory in nature, not addressing education is anathema to any political party’s ambitions.

Second, the closing of the economic gap between the U.S. and China suggests that the longstanding hegemony of the dollar is a waning safety buffer. Should China become the world’s biggest economy — a condition that the BBC forecasts will occur by 2028 — future generations of American workers risk falling behind not only in book smarts but also in marketable skills.

Third, the National Education Association sounded the alarm back in 2016 that nations under the Organization for Economic Co-operation and Development (OECD) had invested heavily in early childhood education. Stats from 2014 illustrate the widening gap:

  • Percentage of 3-year-olds enrolled in early education: 42% in the U.S. versus 71% among OECD nations.
  • Percentage of 4-year-olds enrolled in early education: 68% in the U.S. versus 85% among OECD nations.

In fact, because the clock has been ticking for so long, an argument can be made that EdTech is a necessity, not a luxury. To be clear, these circumstances don’t guarantee LCW stock profitability. However, securing a sector-related business combination will go a long way toward establishing credibility.

How to Buy Learning CW Investment Corporation (LCW) Stock

As publicly traded entities, SPACs are easy to acquire, especially if you already know how to buy stocks. If not, just follow the steps below.

Step 1: Pick a brokerage.

While any brokerage will allow retail investors to purchase SPACs, you should consider narrowing your list of best brokers to platforms that facilitate the most access to investing opportunities, including pre-IPO access or new issues at their initial offering price.

Step 2: Decide how many shares you want.

Any IPO is a venture into the unknown. Therefore, avoid putting all your eggs in 1 basket by choosing a balanced share count.

Step 3: Choose your order type.

Before placing the order, understand these market concepts.

  • Bid: The buyer’s top offer for a stock.
  • Ask: The seller’s minimum agreeable price.
  • Spread: The difference in the bid-ask price, the spread is a risk indicator. Narrower spreads represent lower risk since the market maker facilitates high-volume (high-demand) transactions, while the opposite is true for wider spreads.
  • Limit order: Buy or sell requests at a predetermined price, limit orders provide transparency but no execution guarantees.
  • Market order: Market orders guarantee fulfillment but only at the prevailing rate.
  • Stop-loss order: A defensive tool, a stop-loss order automatically exits your position at either a predetermined price or anything lower.
  • Stop-limit order: Stop limits are similar to stop losses but only execute (exit) at a predetermined price. However, such orders carry the same non-fulfillment risk as limit orders.

Step 4: Execute your trade.

To execute a market order, follow these steps:

  1. Select your action type (buy or sell).
  2. Enter the shares you want to acquire (or sell).
  3. Hit the Buy (or Sell) button.

Follow the same sequence for limit orders (but include your execution price).

Banking on the Digital Classroom

As the lone superpower, the U.S. enjoys the privilege of overlooking many of its educational problems. But shifting economic tides and greater global competitiveness have forced American policymakers to consider effective solutions, with EdTech platforms being the most promising. While SPACs carry significant risks, speculators may want to turn the page to LCW stock.

About Joshua Enomoto

His distinct writing style of distilling convoluted data into relatable and compelling narratives has earned him recognition among several investment-related publications.