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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Calvin_2011 who wrote (42620)	5/12/2011 11:30:57 PM
From: Jurgis Bekepuris	Respond to of 78628

If you don't have a special knowledge or insight into this industry, then COCO is just a coin toss for you. Short term the stock will be volatile based on media coverage and regulation changes. But you have to be a trader to play that. Long term IMHO government cannot keep the status quo, they have to limit bad loan flow to private ed companies. The question is whether private ed companies will be able to adapt to changed regulations and how onerous the regulations will be. Both are tough to answer.

To: Calvin_2011 who wrote (42620)	5/12/2011 11:55:41 PM
From: Mark Marcellus	Read Replies (2) \| Respond to of 78628

For profit education is a very good place for value investors to be looking right now, IMO. A lot of the companies, including COCO, are showing up on Greenblatt's Magic Formula screen. I've spent some time studying these companies, and I've decided to shy away from COCO and APOL. From what I've seen, they have been much more aggressive than others in engaging in the sharp practices that have led to the intense scrutiny the sector faces from the Department of Education. The two stocks I like most in this sector are Devry (DV) and Strayer Education (STRA) (I own both). Both are beaten down, though DV has had a bit of a run up lately while STRA is trading near a 52 week low. I also recommend a read of Strayer's 2010 Annual Report, which is available on their web site. strayereducation.com Management of this company does a better job than most of explaining their business and laying out their long term strategy. They also go into great detail explaining what the new Education Department rules are and the issues they've faced in trying to understand and adhere to them. It's a good description from the trenches of what these institutions are up against and is worthwhile reading if you're interested in the sector, whether or not you're interested in this particular company.

To: Calvin_2011 who wrote (42620)	5/13/2011 12:27:44 AM
From: Shane M	Respond to of 78628

The education companies are all over my screens right now and have been for quite a while. Alot of the bad press is justified in my view, but even with a bad taste in your mouth you might be able to make money. It's really about these companies ability to keep the government loan guarantees flowing. Can they graduate enough % to keep the $ flowing? Without govt student loan access they're dead in water though. I agree with other posters that they've gotta figure out how to stop trying to attract students that don't belong in college, and instead attract the folks that can graduate. They've gotta improve their value proposition.

To: Calvin_2011 who wrote (42620)	5/13/2011 5:52:07 AM
From: EL KABONG!!!	1 Recommendation Read Replies (1) \| Respond to of 78628

I worked within the community college arena during my working years. Lots of financing came to the colleges via state and county property taxes, educational dollars from the state treasury (grants, special project funding, etcetera) and special educational tax assessments. More money came from the federal government through federal grants and other projects. It would appear as though the USA (and other western societies) will soon be entering a period of economic austerity, and any reduction of monies from the county, state or federal government will surely have an impact on all post secondary education facilities, whether private sector or public sector. A double whammy comes in the form of federal and state financial aid programs for students. With near certainty, these aid programs will have their funding slashed or even eliminated, separating many potential students from any opportunity for a college education. In my opinion, the markets have correctly priced the stocks of the private schools like Strayer, Apollo Group and Corinthian, taking in all of the current risk factors. If it were me, I'd take a wait and see attitude until the current government financial deficits are dealt with. EK!!!