Expected Increase in the Use of Scholarships in the Education Sector as Companies Look to Improve the Value Proposition of Education: Expert Analyst Jeffrey M. Silber Shares His Outlook on the Space with TWST

Wall Street Transcript

67 WALL STREET, New York - August 30, 2013 - The Wall Street Transcript has just published its Education Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Gainful Employment Clarification - Enrollment and Retention Trends - Economic Recovery and Enrollment Trends - Growth Drivers in Chinese Education Sector

Companies include: K12, Inc. (LRN), Apollo Group Inc. (APOL), Bridgepoint Education, Inc. (BPI), Grand Canyon Education, Inc. (LOPE), American Public Education, Inc (APEI), DeVry, Inc. (DV) and many more.

In the following excerpt from the Education Report, an expert analyst discusses the outlook for the sector for investors:

TWST: What will you be looking for in the next round of earnings reports?

Mr. Silber: The rate of starts trumps everything. That's a leading indicator to see that trends are starting to move in the right direction again.

I would generally say also that companies are changing the marketing message. We've seen some companies really spend a lot more on branding. Apollo's University of Phoenix is a prime example, where they're changing the message to a "let's go to work" message, really focusing on how they can improve the value proposition for students who attend their schools.

I think we'll also be looking for an increase in the use of scholarships. At the back end of the value proposition, it's improving the job outlook; at the front end, it's making sure students don't take on as much debt. Virtually every public company in the space now offers some form of scholarship to entice students to not only enroll, but more importantly continue to retain and help students move their way toward graduation.

As long as students go through the program and finish, there's a much better chance that they'll pay back their debt, which has been a big problem for students going to for-profit schools. Any way that they can improve the value proposition, I think, is another thing that we'll be looking for in these companies.

TWST: So what are your recommendations? Any top stock picks?

Mr. Silber: We've been reluctant to recommend stocks in this group because of everything that's been going on. The two that we've been focused on throughout this time frame have been Grand Canyon Education (LOPE) and American Public...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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