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DeVry Education (DV) Prospects Bright on Trump Victory
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On Dec 5, we issued an updated research report on DeVry Education Group Inc. (DV - Free Report) – a provider of secondary and post-secondary education.
Impressive first-quarter fiscal 2017 results, cost-saving initiatives and plans to introduce more stackable programs in 2017 are doing the tricks for DeVry.
Moreover, the U.S. presidential election had a positive impact on the school industry as shares of for-profit education companies like Universal Technical Institute, Inc.(UTI - Free Report) , Strayer Education (STRA - Free Report) , K12 Inc.(LRN - Free Report) and American Public Education, Inc. (APEI - Free Report) have rallied since the victory of Donald Trump.
The new president had assured relaxed federal regulations for such companies during his campaigns. DeVry’s shares gained over 31% since the release of its first-quarter fiscal 2017 earnings (on Nov 1), outperforming 2.35% growth for the Zacks categorized School industry.
Again, the stock has a VGM Style Score of ‘A’. Notably, our research shows that stocks with VGM Scores of ‘A’ or ‘B’ when combined with a Zacks Rank #1 or 2 (Buy) make solid investment choices.
What’s Driving DeVry?
DeVry’s health care and international institutions – Chamberlain, Ross, Becker – have shown significant improvement in revenues and profits in the past three years. These medical schools produce strong student outcomes, with very low cohort-default rates and high job placements. In addition, these schools have been continuously opening campuses and introducing programs in order to capitalize on the strong demand.
Also DeVry reported impressive first-quarter fiscal 2017 results and has surpassed the Zacks Consensus Estimate for sales and earnings for the third quarter in a row.
Throughout fiscal 2017, the company plans to introduce a number of short-period, stackable programs that will provide students the flexibility and affordability to pursue education outside the traditional degree course structure.
Also, DeVry adopted several cost-saving initiatives like workforce reduction and curbing discretionary spending. The company is following a strict cost-control routine, with special emphasis on controlling escalating costs at DeVry University and Carrington Colleges. The company also condensed the footprint of DeVry University.
The company has been witnessing a persistent decline in enrollments at its flagship institution, DeVry University, which accounts for a major portion of its revenues. DeVry University’s starts have also been declining for several years now and are expected to remain a challenge over the near term, as prospective students are reluctant to incur debts for pursuing higher degree. The competition in this space is also intense.
As the employment scenario is improving, more adult students are opting for jobs while the demand for academic programs is on the decline. There is also growing reluctance among students to enroll in academic programs and take loans to fund them.
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DeVry Education (DV) Prospects Bright on Trump Victory
On Dec 5, we issued an updated research report on DeVry Education Group Inc. (DV - Free Report) – a provider of secondary and post-secondary education.
Impressive first-quarter fiscal 2017 results, cost-saving initiatives and plans to introduce more stackable programs in 2017 are doing the tricks for DeVry.
Moreover, the U.S. presidential election had a positive impact on the school industry as shares of for-profit education companies like Universal Technical Institute, Inc.(UTI - Free Report) , Strayer Education (STRA - Free Report) , K12 Inc.(LRN - Free Report) and American Public Education, Inc. (APEI - Free Report) have rallied since the victory of Donald Trump.
The new president had assured relaxed federal regulations for such companies during his campaigns. DeVry’s shares gained over 31% since the release of its first-quarter fiscal 2017 earnings (on Nov 1), outperforming 2.35% growth for the Zacks categorized School industry.
Again, the stock has a VGM Style Score of ‘A’. Notably, our research shows that stocks with VGM Scores of ‘A’ or ‘B’ when combined with a Zacks Rank #1 or 2 (Buy) make solid investment choices.
What’s Driving DeVry?
DeVry’s health care and international institutions – Chamberlain, Ross, Becker – have shown significant improvement in revenues and profits in the past three years. These medical schools produce strong student outcomes, with very low cohort-default rates and high job placements. In addition, these schools have been continuously opening campuses and introducing programs in order to capitalize on the strong demand.
Also DeVry reported impressive first-quarter fiscal 2017 results and has surpassed the Zacks Consensus Estimate for sales and earnings for the third quarter in a row.
Throughout fiscal 2017, the company plans to introduce a number of short-period, stackable programs that will provide students the flexibility and affordability to pursue education outside the traditional degree course structure.
Also, DeVry adopted several cost-saving initiatives like workforce reduction and curbing discretionary spending. The company is following a strict cost-control routine, with special emphasis on controlling escalating costs at DeVry University and Carrington Colleges. The company also condensed the footprint of DeVry University.
This Zacks Rank #2 (Buy) stock has a decent earnings history, beating the Zacks Consensus Estimate in all of the past four quarters at an average of 8.9%. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Concerns
The company has been witnessing a persistent decline in enrollments at its flagship institution, DeVry University, which accounts for a major portion of its revenues. DeVry University’s starts have also been declining for several years now and are expected to remain a challenge over the near term, as prospective students are reluctant to incur debts for pursuing higher degree. The competition in this space is also intense.
As the employment scenario is improving, more adult students are opting for jobs while the demand for academic programs is on the decline. There is also growing reluctance among students to enroll in academic programs and take loans to fund them.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>