Adult education stocks plummet: Opportunity for STRA, DV, CECO, CPLA?
Today's Financial News - Posted March 16, 2009
Capella Education Company (CPLA), Strayer Education, Inc. (STRA), DeVry Inc. (DV), Career Education Corp. (CECO) fell by double-digit margins today… on virtually no news. Is it time to bail… or buy more?
by J. Christoph Amberger
Baltimore—TFN: While AIG stock soared despite the public piety of politicians, adult education stocks tumbled by double digits:
Capella Education Company (NASDAQ:CPLA) fell 11%
Strayer Education, Inc. (NASDAQ:STRA) was down almost 14%
DeVry Inc. (NYSE:DV) lost over 10%
Career Education Corp. (NASDAQ:CECO) was decimated by almost 14%
Most other education stocks didn’t do too well, either. Which seems counter-intuitive: With millions of American professionals unemployed, the reasonable thing would be to look at education companies offering to polish up resumés with workplace-geared degrees.
The companies themselves apparently are counting on this particular “Obama Effect”: Capella Education Company had just announced that for Q1 q2009, revenue was expec to grow by 16.0% to 17.5% compared to the first quarter of 2008. For fiscal 2009, Capella expects revenue and average quarterly enrollment to come in up 18% to 21% over fiscal 2008.
Other than the White House responding to focus groups who think it’s time to talk down the crisis (now that stimulus and omnibus have passed), there is no reason to believe unemployment will drop anytime soon. Neither will demand for adult education.
Dips in these stocks—which this far have weathered the downturn quite nicely—should be used as buying opportunities.
*** MRSA, or Methicillin-Resistant Staphylococcus aureus, has been making news headlines all week: It’s been found in pork, in ocean water, on ambulance stethocopes, cellphones brought into hospitals. And as we predicted two months ago, the deadly bug has turned into a cash cow for litigation lawyers. Good news for us… and for those Hot Stock Confidential members who bought shares in the company we recommended: A major western country known for its centralized approach to healthcare has just issued a medical device license the company’s rapid-detection test. Find out on how you can take advantage of the buying opportunity created by last month’s stock market collapse!
Read our special report right here!
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