Universal Technical Institute, Inc. UTI recently provided an update on business and campus operations. The company announced that 12 of its 13 campuses are now open with in-person labs, operating per the guidelines passed by Centers for Disease Control & Prevention and local authorities. Notably, its Bloomfield, NJ campus also resumed in-person labs on Jul 1, 2020.
More than 500 students have graduated from various programs since the reopening of campuses. Also, students on leaves of absence have declined 65% from May.
The company’s third-quarter fiscal 2020 results, which are likely to release in early August, are expected to reflect 3-6% increase in student starts from the prior-year quarter. Notably, its enhanced digital media marketing strategy witnessed accelerating year-over-year growth in inquiry volume in the fiscal third quarter. Encouragingly, new student enrollments for the fiscal fourth quarter exceeded its target of 90%, which was set prior the COVID-19 outbreak.
In the wake of the coronavirus outbreak, Universal Technical has combined online, instructor-delivered lectures and demonstrations with in-person labs across the campuses. The company has been following health authority guidelines for the safety and well-being of students as well as employees. Additionally, it continues to help students with the utilization of the Higher Education Emergency Relief Funds, which is granted through the CARES Act. The cash grants will help students to meet expenses for food, housing, childcare, transportation and technology.
The company now expects that its graduates will remain in demand for years to come, rebuilding the economy, as the COVID-19 pandemic has caused record unemployment and economic downturn in recent times. Jerome A. Grant, chief executive officer of Universal Technical said, "We are seeing growing interest in a UTI education and expect more students to turn to industry-aligned technical training as a gateway to stable, rewarding careers.”
In the past three months, shares of the company have gained 35.4% compared with the industry’s 26.5% rally. The uptick can primarily be attributed to improved results for the fiscal second quarter backed by strategic initiatives to boost students’ engagement and responses to COVID-19 shutdowns. Also, focus on smaller commuter-friendly campuses in high-demand locations, original equipment manufacturers and other industry relationships, along with marketing efficiency are adding to the bliss.
Moreover, the recent news along with above-mentioned tailwinds will further boost investors’ sentiments in the near future.
Universal Technical, which shares space with Strategic Education, Inc. STRA, Lincoln Educational Services Corporation LINC and Perdoceo Education Corporation PRDO in the same industry, currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank Strong Buy) stocks here.
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