While it's not found in most dictionaries, it's a commonly understood word in informal settings, especially in North America.
It's a shortened form of "co-eds", which itself was a shortened form of "coeducational students".
However, using "coeds" can be considered outdated and potentially offensive as it reinforces a gender stereotype. It's more respectful and inclusive to use terms like "female students", "women students", or simply "students".