What Happened?
Shares of online learning platform Coursera (NYSE: COUR) fell 7.1% in the afternoon session after the stock's momentum weakened as the company announced a definitive all-stock merger with competitor Udemy in a deal valued at approximately $2.5 billion.
Under the terms of the agreement, Coursera shareholders were expected to own about 59 percent of the combined entity, with Udemy shareholders owning the remaining 41 percent. The companies projected annual cost savings of around $115 million within two years. Despite the potential for creating a larger learning platform, the market reacted negatively. This response may have been influenced by the all-stock nature of the transaction, which can dilute the value for existing shareholders. Adding to the cautious sentiment, UBS had lowered its price target on Coursera from $11.00 to $9.00 a day before the announcement, while keeping a Neutral rating.
The shares closed the day at $7.58, down 6.8% from previous close.
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What Is The Market Telling Us
Coursera’s shares are quite volatile and have had 17 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 4% on the news that the latest Consumer Price Index (CPI) report showed inflation cooling more than anticipated, fueling optimism for potential Federal Reserve interest rate cuts.
The November report indicated that annual inflation fell to 2.7%, significantly below economists' expectations of 3.1% and its lowest level since July. The Consumer Price Index, or CPI, is a key measure of inflation. This encouraging data was welcomed by investors, as sustained lower inflation could give the U.S. Federal Reserve more justification to lower interest rates in the coming year. Wall Street favors lower interest rates because they reduce borrowing costs for companies and can stimulate economic activity, making stocks more attractive. The positive news helped major indexes, including the S&P 500 and the tech-heavy Nasdaq, snap a four-day losing streak.
Coursera is down 10.7% since the beginning of the year, and at $7.58 per share, it is trading 40.4% below its 52-week high of $12.70 from August 2025. Investors who bought $1,000 worth of Coursera’s shares at the IPO in March 2021 would now be looking at an investment worth $168.33.
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