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Adtalem (ATGE) Extends BSN Sessions to Tap Growing Demand

Zacks Equity Research

Adtalem Global Education Inc.’s ATGE health care institution, Chamberlain University introduced evening and weekend sessions of its Science in Nursing (“BSN”) degree program at the Chicagoland Addison campus. The new schedule is designed for students who wish to pursue these degree programs but are unable to attend classes during weekdays.

The program with extended schedule will offer same curriculum, quality, faculty, and administrative and clinical support as the traditional weekday program. The company believes that these new sessions will bridge the gap between nursing shortage and potential students who have the desire to commit to the nursing profession.

Initiatives to Drive Performance

Adtalem has been driving overall results on the back of certain strategic initiatives. The company keeps on introducing new degree programs and campuses in order to better serve students. It ensures a balanced focus on investment initiatives to deliver direct returns to its shareholders.

In particular, Chamberlain university remains well positioned to gain from growing demand for nurses and the increasing roles they play in the healthcare industry. Notably, the recent move will help the company to capitalize on this supply-demand imbalance in nursing and the broader healthcare industry. It is optimistic about the demand trend in the medical and healthcare segment from both students and employees.

Chamberlain’s new student enrollment remained solid in the January 2019 session, improving 6.4% from a year ago. However, the same declined 3.7% year over year in the March session. Nonetheless, total student count increased 3.4% in the last reported quarter, backed by strong growth in both Bachelor of Science in Nursing and graduate programs.

Notably, in fiscal third-quarter 2019, the company recorded new student enrollment growth of 15.4% and total student enrollment growth of 4.3% from the prior year.

Coming to price performance, shares of the company have declined 6.9% so far this year, comparing unfavorably with its industry’s 23% growth. That said, the above-mentioned initiatives and the recent move will aid the company’s profitability going forward and hence share price performance.

Zacks Rank & Key Picks

Currently, Adtalem carries a Zacks Rank #4 (Sell). Some better-ranked stocks from the same industry include Strategic Education, Inc. STRA, Bright Horizons Family Solutions Inc. BFAM and Career Education Corp. CECO. While Strategic Education sports a Zacks #1 Rank (Strong Buy), Bright Horizons and Career Education carry a Zacks Rank #2 (Buy). You can the complete list of today’s Zacks #1 Rank stocks here.

Strategic Education has an expected earnings growth rate of 36.2% for 2019.

Bright Horizons’ earnings per share are expected to increase 12.8% in 2019.

Career Education is expected to record an EPS growth rate of 11.4% in 2019.

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