24/7 Wall St. » COCO

24/7 Wall St. Closing Bell (CHK, LVLT, QCOM, CRM, DSX, COCO, APA, WNR, YRCW, SHOO, SRE, SLE, RGLD, OWW, GM, MGM, AES, LNG, DUK, EL, PGR, WPO, GMCR, KNSY, HLF)

Paul Ausick — Thu, 03 May 2012 20:08:03 +0000

The major US stock indexes opened mostly flat this morning following a softer-than-expected report from the Institute for Supply Management on non-manufacturing growth (our coverage here). The report on new unemployment benefits claims came in better than expected, but not enough to overcome the ISM numbers (more coverage here). Retail sales reports were also weak, with growth of just 0.8% compared with an estimate of 1.5% (more coverage here). The energy sector has been particularly hard hit today on reports that supply is keeping up with demand, some weak earnings reports, and a comment from OPEC that it would like to see Brent crude at $100/barrel, not $120 or more (our coverage here).

The US dollar index rose today, now up 0.11% at 79.221. The GSCI commodity index is down about -1.3% at 678.65, with commodities mixed on the small gains in the dollar. WTI crude oil closed down -2.6% at $102.54/barrel, and Brent crude trades down -1.84% at $116.02/barrel. Gold settled down -1.2% today, at $1,634.80/ounce.

The unofficial closing bells put the DJIA down nearly 62 points to 13,206.59 (-0.47%), the NASDAQ fell more than 35 points (-01.16%) to 3,024.30, and the S&P 500 fell -0.77% or nearly 11 points to 1,391.57.

There were several analyst upgrades and downgrades today, including Chesapeake Energy Corp. (NYSE: CHK) maintained as ‘buy’ but target price cut to $31 at BofA/ML and raised to ‘outperform’ at Bernstein; Level 3 Communications Inc. (NYSE: LVLT) reiterated ‘buy’ at SunTrust Robinson Humphrey and cut to ‘neutral’ at Piper Jaffary; Qualcomm Inc. (NASDAQ: QCOM) reiterated as ‘buy’ at BofA/ML; and Salesforce.com (NYSE: CRM) raised to ‘outperform’ with a $185 target price at Credit Suisse.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Diana Shipping Inc. (NYSE: DSX) is down -4.4% at $7.63; Corinthian Colleges Inc. (NASDAQ: COCO) is down -21.6% at $3.05; Apache Corp. (NYSE: APA) is down -3.7% at $91.99; Western Refining Inc. (NYSE: WNR) is down -2.6% at $18.42; YRC Worldwide Inc. (NASDAQ: YRCW) is down -8% at $6.79; Steve Madden Ltd. (NASDAQ: SHOO) is down -1.7% at $43.54; Sempra Energy (NYSE: SRE) is up 0.6% at $64.29 after posting a new 52-week high of $65.37 earlier today; Sara Lee Corp. (NYSE: SLE) is down -1% at $22.10; Royal Gold Inc. (NASDAQ: RGLD) is down -2.6% at $59.43 (more coverage here); Orbitz Worldwide Inc. (NYSE: OWW) is up 4.9% at $4.09; General Motors Co. (NYSE: GM) is down -2.3% at $22.42 (more coverage here); and MGM Resorts International (NYSE: MGM) is down -4.4% at $12.95.

Tomorrow we get earnings from AES Corp. (NYSE: AES), Cheniere Energy Inc. (AMEX: LNG), Duke Energy Corp. (NYSE: DUK), Estee Lauder Companies Inc. (NYSE: EL), Progressive Corp. (NYSE: PGR), and The Washington Post Co. (NYSE: WPO).

Other standouts from today include the following stocks:

Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is down -47.3% at $26.11. The company reported earnings last night, and lowered guidance. More coverage here and here.

Kensey Nash Corp. (NASDAQ: KNSY) is up 32.2% at $38.35. The company is being acquired by a Dutch firm for $360 million. More coverage here.

Herbalife Ltd. (NYSE: HLF) is down -12.7% at $46.02. The nutrition products company flubbed some questions at last night’s conference call. More coverage here.

Stay tuned for Friday. San Francisco Fed President John Williams is giving a speech. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – Non-farm payrolls
3:00 p.m. – Treasury STRIPS

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AES, APA, CHK, COCO, CRM, DSX, DUK, EL, GM, GMCR, HLF, KNSY, LNG, LVLT, MGM, OWW, PGR, QCOM, RGLD, SHOO, SLE, SRE, WNR, WPO, YRCW

24/7 Wall St. Closing Bell (CHK, COP, RSH, STM, AIZ, ABX, MRO, MA, AGN, AUY, TWX, CLX, RDC, RRD, MSO, IACI, FSLR, DSX, COCO, APA, OWW, WNR, CMCSA, SVNT)

Paul Ausick — Wed, 02 May 2012 20:09:45 +0000

The major US stock indexes opened lower this morning following dismal reports from Europe on manufacturing (our coverage here) and unemployment (more coverage here). The ADP report on US unemployment provided more gloomy news ahead of Friday’s official unemployment numbers (more coverage here). The US EIA petroleum inventory report helped push oil prices down (more coverage here), but the weak economic news ruled the day. Only the Nasdaq index has managed to pull into positive territory at all today, and that by less than 0.2% about an hour before closing. The US dollar index rose today, now up 0.39% at 79.130. The GSCI commodity index is up fractionally at 687.61, with commodities mostly lower on the rising dollar. Chicago wheat fell more than -4.5% to post the biggest loss of the day. WTI crude oil closed down -0.9% at $105.22/barrel, and Brent crude trades down -1.23% at $1118.19/barrel. Gold settled down -0.5% today, at $1,654.00/ounce.

The unofficial closing bells put the DJIA down nearly 11 points to 13,268.65 (-0.08%), the NASDAQ rose more than 9 points (0.31%) to 3,059.85, and the S&P 500 fell -0.25% or more than 3 points to 1,402.31.

There were several analyst upgrades and downgrades today, including Chesapeake Energy Corp. (NYSE: CHK) cut to ‘neutral’ at R.W. Baird; ConocoPhillips (NYSE: COP) cut to ‘underperform’ at BofA/ML and started as ‘overweight’ at JPMorgan; RadioShack (NYSE: RSH) raised to ‘buy’ at Auriga; STMicroelectronics NV (NYSE: STM) raised to ‘buy’ at Goldman Sachs and raised to ‘neutral’ at Citigroup; and Assurant Inc. (NYSE: AIZ) cut to ‘underperform’ at BofA/ML.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Barrick Gold Corp. (NYSE: ABX) is down -2.8% at $39.30 (more coverage here); Marathon Oil Corp. (NYSE: MRO) is down -4.4% at $28.85; Mastercard Inc. (NYSE: MA) is down -0.8% at $452.14; Allergan Inc. (NYSE: AGN) is down -4.3% at $92.29; Yamana Gold Inc. (NYSE: AUY) is down -2.6% at $14.36; Time Warner Inc. (NYSE: TWX) is down -1.6% at $37.30; The Clorox Co. (NYSE: CLX) is down -3.3% at $67.74; Rowan Companies Inc. (NYSE: RDC) is up 1.3% at $34.97; R.R. Donnelley & Sons Co. (NASDAQ: RRD) is down -7% at $11.79; Martha Stewart Living Omnimedia Inc. (NYSE: MSO) is down -1.2% at $3.41; and IAC/InterActiveCorp. (NASDAQ: IACI) is up 3.3% at $50.34 after posting a new 52-week high of $52.77 earlier today.

Tomorrow we get earnings from First Solar Inc. (NASDAQ: FSLR), Diana Shipping Inc. (NYSE: DSX), Corinthian Colleges Inc. (NASDAQ: COCO), Apache Corp. (NYSE: APA), Orbitz Worldwide Inc. (NYSE: OWW), and Western Refining Inc. (NYSE: WNR) among many others.

Other standouts from today include the following stocks:

Chesapeake Energy is down -13.5% at $16.95 after posting a new 52-week low of $15.86 earlier today. The natural gas producer reported weak results and more troubles for CEO Aubrey McClendon. More coverage here.

Comcast Corp. (NASDAQ: CMCSA) is down -1% at $30.29. The cable company reported good earnings this morning. More coverage here.

Savient Pharmaceuticals Inc. (NASDAQ: SVNT) is down -18.8% at $1.51. An analyst has said that the company insolvent. More coverage here.

Stay tuned for Thursday. Philadelphia Fed President Charles Plosser, Atlanta Fed President Dennis Lockhart, and San Francisco Fed President John Williams are speaking at a conference. We have noted the following events on the schedule (all times Eastern):

7:30 a.m. – Challenger job cut report
8:30 a.m. – New claims for unemployment benefits
8:30 a.m. – Productivity and costs report
10:00 a.m. – ISM non-manufacturing index
10:30 a.m. – EIA weekly natural gas storage report
4:30 p.m. – Federal Reserve balance sheet and money supply

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: ABX, AGN, AIZ, APA, AUY, CHK, CLX, CMCSA, COCO, COP, DSX, FSLR, IACI, MA, MRO, MSO, OWW, RDC, RRD, RSH, STM, SVNT, TWX, WNR

Capella Leads For-Profit Colleges’ Downturn (CPLA, APOL, DV, CECO, COCO, STRA, WPO)

Paul Ausick — Tue, 24 Apr 2012 16:02:32 +0000

The crackdown on financial aid to students at for-profit colleges has taken a toll on the revenues of these institutions over the past couple of years. But the restrictions on the way these schools recruit and admit new students may be the biggest problem the colleges face. Today’s earnings from Capella Education Co. (NASDAQ: CPLA) highlight the problem.

A quick check of seven of these for-profit schools shows that over the past five years only one is showing a profit: DeVry Inc. (NYSE: DV) is up 6.6% since April of 2007. For the same period, Apollo Group Inc. (NASDAQ: APOL) is down -29%, Career Education Corp. (NASDAQ: CECO) is down -77%, Corinthian Colleges Inc. (NASDAQ: COCO) is down -74%, Strayer Education Inc. (NASDAQ: STRA) is down -33%, and the Washington Post Co. (NYSE: WPO), owner of the Kaplan franchise, is down -50%.

Capella reported this morning that first quarter EPS came in at $0.82 on revenue of $109.4 million. The consensus estimates called for EPS of $0.78 on revenue of $110 million. In the same period last year Capella posted EPS of $0.90 on revenue of $111.35 million.

What hurt the company today is its enrollment forecast. Capella’s new student enrollments have fallen for six straight quarters, including a loss of -5% in the first quarter of 2012. The company’s CFO said in a conference call that Capella is “less optimistic” about enrollment growth throughout 2012, and that the company expects to see enrollment declines in “the high single-digit” range for the current quarter.

Contributing to the enrollment troubles at Capella and the others is recent legislation introduced into the US House of Representatives that would severely curtail the use of any federal money by the schools to advertise and market to potential students. The legislation would also apply to non-profit schools, but the impact would be greatest on the for-profits.

The legislation faces stiff opposition in both the House and the Senate and may well be defeated. That is not likely to not constrain future efforts to rein in the flow of federal dollars to for-profit schools.

Capella’s shares are down -9.6% at about noon today, at $31.12 in a 52-week range of $26.12-$54.86.

Paul Ausick

Filed under: Earnings Tagged: APOL, CECO, COCO, CPLA, DV, STRA, WPO

Top Analyst Upgrades & Downgrades (ALXN, AAPL, ADP, COCO, EBAY, FFIV, INTC, NAV, ZNGA)

Administrator — Thu, 19 Apr 2012 12:44:41 +0000

These are some of the top analyst upgrades, downgrades and initiations seen in Wall Street research calls this Thursday.

Alexion Pharmaceuticals, Inc. (NASDAQ: ALXN) Raised to Outperform as Bull of the Day at Zacks.

Apple Inc. (NASDAQ: AAPL) Reiterated Buy and Raised target to $740 at Canaccord Genuity.

Automatic Data Processing, Inc. (NASDAQ: ADP) Reiterated Outperform with $65 target at Credit Suisse.

Corinthian Colleges Inc. (NASDAQ: COCO) Raised to Equal-weight at Barclays.

eBay Inc, (NASDAQ: EBAY) Raised to Buy at Benchmark; Raised to Overweight at Piper Jaffray; maintained as Hold at Canaccord Genuity.

F5 Networks, Inc. (NASDAQ: FFIV) Raised to Buy at Wunderlich.

Intel Corporation (NASDAQ: INTC) Reiterated Buy with $34 target at Argus.

Navistar International Corporation (NYSE: NAV) Cut to Market Perform at Wells Fargo.

Zynga, Inc. (NASDAQ: ZNGA) Raised to Hold at Needham.

If you enjoyed the top analyst upgrades and downgrades, you can join our free email newsletter that includes analyst summaries each morning sent right to your inbox. We also cover top issues such as IPOs, special financial exclusives, mergers and more. Sign up in the box below.

JON C. OGG

Filed under: Analyst Calls Tagged: AAPL, ADP,, ALXN, COCO, EBAY, FFIV, INTC, NAV, ZNGA

24/7 Wall St. Closing Bell (C, NEM, STX, XOM, MWW, AMZN, BRCM, AET, COCO, EPD, MAN, MPC, NOC, WHR, KTCC, SGMO, MDVN, JDAS, IXYS)

Paul Ausick — Wed, 01 Feb 2012 21:04:57 +0000

The three major US stock indexes opened higher this morning, following on a positive debt sale by Portugal and some improvement in PMI numbers from Europe. ADP employment data did not meet expectations, but did not pull stocks down. ISM data fell a bit short of expectations, but construction spending rose sharply. In Asia, China posted mixed PMI reports and the country’s data on new loans was lower than expected. US oil and gasoline inventories rose more than expected, put a crimp in energy prices that had started our higher for the day (more coverage here). WTI crude finished the day down -0.9% at $97.61/barrel, its lowest level in six weeks. Brent crude rose 0.71% to $111.77/barrel. Gold closed up 0.41% at $1,747.60.

The unofficial closing bells put the DJIA up more than 83 points to 12,716.31 (0.66%), the NASDAQ rose more than 34 points (1.22%) to 2,848.27, and the S&P 500 rose 0.89% or nearly 12 points to 1,324.08.

There were several analyst upgrades and downgrades today, including Citigroup Inc. (NYSE: C) raised to ‘outperform’ at Wells Fargo; Newmont Mining Corp. (NYSE: NEM) cut to ‘hold’ at Stifel Nicolaus; Seagate Technology PLC (NASDAQ: STX) raised to ‘buy’ at Stifel Nicolaus; Exxon Mobil Corp. (NYSE: XOM) cut to ‘hold’ at Argus (see our coverage here); and Monster Worldwide Inc. (NYSE: MWW) cut to ‘perform at Oppenheimer. Amazon.com (NASDAQ: AMZN) had three ratings changes today: maintained as ‘neutral’ with target price cut to $190 at Credit Suisse; maintained ‘outperform’ but estimates cut at Baird; and target price lowered to $225 at Jefferies.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Amazon.com is down -8.2% at $178.51; Broadcom Corp. (NASDAQ: BRCM) is up 8.24% at $37.18; Aetna Inc. (NYSE: AET) is up 3.3% at $45.13; Corinthian Colleges Inc. (NASDAQ: COCO) is up nearly 34% at $4.05; Enterprise Products Partners L.P. (NYSE: EPD) is up 3.8% at $50.13, after posting a new 52-week high of $50.35 earlier today; Manpower Inc. (NYSE: MAN) is up nearly 14% at $45.70; Marathon Petroleum Corp. (NYSE: MPC) is up nearly 10% at $41.98; Northrup Grumman Corp. (NYSE: NOC) is up 2.22% at $59.34; and Whirlpool Corp. (NYSE: WHR) is up 14% at $61.93.

Other standouts from today include the following stocks:

Key Tronic Corp. (NASDAQ: KTCC) is up nearly 37% at $8.53, after posting a new 52-week high of $8.74 earlier today. The computer peripherals maker posted better-than-expected earnings and revenues after markets closed last night.

Sangamo BioSciences Inc. (NASDAQ: SGMO) is up more than 21% at $4.19. The pharmaceutical maker has announced a collaboration with Shire plc (NASDAQ: SHPGY) to develop a hemophilia treatment.

Medivation Inc. (NASDAQ: MDVN) is up more than 21% at $67.26, after posting a new 52-week high of $70.87 earlier today. The development stage drug maker has reported highly positive results on a test of its late-stage prostate cancer treatment. We have more coverage here.

JDA Software Group Inc. (NASDAQ: JDAS) is down more than -17% at $24.39. The software maker issued a fairly weak quarterly report and continuing investor wariness remains over an SEC investigation of the company’s accounting practices.

IXYS Corp. (NASDAQ: IXYS) is down more than 14% at $11.76. The integrated circuit maker posted poor quarterly numbers after markets closed last night.

Stay tuned for Thursday. Federal Reserve chairman Ben Bernanke is speaking at 10:00 a.m. and Dallas Fed president Richard Fisher is speaking in the evening. We have noted the following events on the schedule (all times Eastern):

7:30 a.m. – Challenger Job-cut data
8:30 a.m. – New claims for unemployment benefits
10:30 a.m. – EIA weekly natural gas storage report
4:30 p.m. – Federal Reserve money supply and balance sheet reports

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: AET, AMZN, BRCM, C, COCO, EPD, IXYS, JDAS, KTCC, MAN, MDVN, MPC, MWW, NEM, NOC, SGMO, STX, WHR, XOM

Morning Movers (COCO, KTCC, STX, IXYS, HA)

Paul Ausick — Wed, 01 Feb 2012 15:19:57 +0000

There are several stocks trading more heavily than usual this morning, and also experiencing large gains or drops in share prices. These include Corinthian Colleges Inc. (NASDAQ: COCO), Key Tronic Corp. (NASDAQ: KTCC), Seagate Technology PLC (NASDAQ: STX), IXYS Corp. (NASDAQ: IXYS), and Hawaiian Holdings Inc. (NASDAQ: HA).

After the first half hour of trading this morning, Corinthian is up more than 27% at $3.86. Volume is already more than double the daily average of about 1.4 million shares traded. The for-profit education company reported reported better-than-expected profits and revenues and forecast third quarter earnings above analysts’ estimates.

Key Tronic is up more than 24% at $7.76 after posting a new 52-week high of $8.10 earlier. Volume is already about 7x the daily average of about 36,000 shares traded. The computer peripherals maker posted better-than-expected earnings and revenues after markets closed last night.

Seagate is up nearly 16% at $24.47 after posting a new 52-week high of $24.71 earlier. Volume is nearly double the daily average of about 10.4 million shares traded. The disk drive maker posted a jump of 3x in net income last night.

IXYS is down nearly -19% at $11.14. Volume is already 50% higher than the daily average of about 99,000 shares traded. The integrated circuit maker posted poor quarterly numbers after markets closed last night.

Hawaiian, parent of Hawaiian Air, is down nearly -12% at $6.15. Volume is already higher than the daily average of about 549,000 shares traded. The airline company posted mixed results for the quarter last night, including a sharp drop year-over-year in EPS.

The DJIA is up 1.09% at about 12,771, the Nasdaq Composite is up 0.71% at about 2,834, and the S&P 500 is up 1.02% at about 1,326.

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: COCO, HA, IXYS, KTCC, STX

Expected Price Gains at For-Profit Education Companies (APOL, EDMC, APEI, STRA, DV, WPO, COCO, BPI, LOPE, CECO)

Paul Ausick — Tue, 01 Nov 2011 20:06:57 +0000

Share prices at for-profit education companies peaked in June and July this year, following a slow start. At the beginning of the year there was widespread fear that new federal rules related to student loans, recruiting practices and employment upon graduation would eviscerate revenues and earnings. However, the rules changes were less onerous than anticipated, and stock prices gradually climbed back up. Enrollments are still a problem at some schools, but share prices are well above lows at most of the companies.

The ten companies we have looked at are Apollo Group (NASDAQ: APOL), Education Management (NASDAQ: EDMC), American Public Education (NASDAQ: APEI), Strayhorn Education (NASDAQ: STRA), DeVry (NYSE: DV), Washington Post (NYSE: WPO), Corinthian Colleges (NASDAQ: COCO), Bridgeport Education (NYSE: BPI), Grand Canyon Education (NASDAQ: LOPE), and Career Education (NASDAQ: CECO).

All data is from Yahoo! Finance, and current share prices were gathered in the mid-afternoon today.

Apollo Group has a median target price of $53.00 from 15 brokers. Shares are trading today at $46.09, for an implied gain of $6.91, or 15%. Apollo’s forward P/E is 12.72 and the company does not pay a dividend. The stock’s 52-week trading range is $33.75 to $54.23, and at today’s price that is about 37% above its 52-week low and 15% below the 52-week high. The company reported better-than-expected quarterly earnings a couple of weeks ago and jumped more than 10% in a day. But lower enrollments plague the company, which has managed to keep revenue up by raising tuition and fees.

Education Management has a median target price of $20.00 from 11 brokers. Shares are trading today at $20.48, about 0.5% above the target price. Education Management’s forward P/E is 13.36 and the company does not pay a dividend. The stock’s 52-week trading range is $11.56 to $28.61. At today’s price it is about 77% above its 52-week low and 28% below the 52-week high. The company beat both quarterly EPS and revenue estimates when it reported earnings last week. But a warning on future enrollment and profit declines have cooled enthusiasm for the shares.

American Public Education has a median target price of $45.00 from 10 brokers. Shares are trading today at $35.11, for an implied gain of $9.89, or 28%. APEI’s forward P/E is 14.50 and the company does not pay a dividend. The stock’s 52-week trading range is $26.15 to $49.29, and at today’s price that is about 49% above its 52-week low and 26% below the 52-week high. The company reports earnings next week and is expected to post EPS of $0.42 on revenue of $62 million. The EPS figure is less than the June quarter, but better than the same period a year ago.

Strayhorn Education has a median target price of $104.00 from 12 brokers. Shares are trading today at $83.06, for an implied gain of $20.94, or 25%. Strayhorn’s forward P/E is 11.39 and the company pays a dividend yield of 4.6%. The stock’s 52-week trading range is $69.34 to $165.73 Today’s price is about 29% above its 52-week low and 50% below the 52-week high. The company reports earnings on Thursday and is expected to post EPS of $1.07 on $139 million in revenue. That is a big dip from the same quarter a year ago, when EPS came in at $1.72, and an even bigger dip sequentially, from $2.53 in the June quarter.

DeVry has a median target price of $52.50 from 16 brokers. Shares are trading today at $38.14, for an implied gain of $14.36, or 38%. DeVry’s forward P/E is 8.55 and the company pays a dividend yield of 0.6%. The stock’s 52-week trading range is $34.24 to $66.85, and at today’s price that is about 11% above its 52-week low and 43% below the 52-week high. The company missed both EPS and revenue projections last week when it reported its first fiscal-quarter 2012 results. Enrollment was also lower as bleak job prospects keep potential students away.

Washington Post has a median target price of $275.00 from just a single broker. Shares are trading today at $336.80, about 18% above the target price. The forward P/E is 19.44 and the company pays a dividend yield of 2.6%. The stock’s 52-week trading range is $308.50 to $455.68. Today’s price is about 9% above its 52-week low and 26% below the 52-week high. The Kaplan education division of the company contributes more than 50% of Washington Post’s revenues and nearly half of net income. The company is expected to post EPS of $3.85 on revenue of $1 billion this Friday. The lack of coverage makes this stock a tough one to figure out.

Corinthian Colleges has a median target price of $2.00 from 10 brokers. Shares are trading today at $2.04, fractionally above the target price. Corinthian’s forward P/E is 9.93 and the company does not pay a dividend. The stock’s 52-week trading range is $1.24 to $6.12, and at today’s price that is about 65% above its 52-week low and 67% below the 52-week high.

Bridgeport Education has a median target price of $26.00 from 10 brokers. Shares are trading today at $22.94, for an implied gain of $3.06, or 13%. Bridgeport’s forward P/E is 8.88 and the company does not pay a dividend. The stock’s 52-week trading range is $13.89 to $30.62, and at today’s price that is about 65% above its 52-week low and 25% below the 52-week high. The company posted better-than-expected third-quarter earnings this morning and raised full-year EPS guidance to $2.95 to $2.98. Enrollment is expected to fall by about 5,000-8,000 students by the end of December.

Grand Canyon Education has a median target price of $18.50 from 10 brokers. Shares are trading today at $15.97, for an implied gain of $2.53, or 16%. Grand Canyon’s forward P/E is 13.22 and the company does not pay a dividend. The stock’s 52-week trading range is $12.26 to $20.66, and at today’s price that is about 30% above its 52-week low and 35% below the 52-week high. The company reports third-quarter earnings next week and is expected to post EPS 0f $0.25 on $109 million in revenues.

Career Education has a median target price of $20 from 11 brokers. Shares are trading today at $15.79, for an implied gain of $4.21, or 27%. The forward P/E is 8.77 and the company does not pay a dividend. The stock’s 52-week trading range is $12.24 to $27.60, and at today’s price that is about 29% above its 52-week low and 43% below the 52-week high. The company reports third-quarter earnings next week, and the consensus EPS estimate is $0.34 on $457 million in revenue. The EPS estimate has been trimmed from $0.46 over the past three months. Shares gained nearly 5% on October 19th, following the strong earnings report from Apollo.

Paul Ausick

Filed under: General Tagged: APEI, APOL, BPI, CECO, COCO, DV, EDMC, LOPE, STRA, WPO

Top Earnings Previews For The Week Ahead (FMCN, COCO, HNZ, TSL, WSM, AEO, AMAT, GES, TOL, ENER, KKD, OVTI, P)

Administrator — Fri, 19 Aug 2011 17:30:15 +0000

Earnings season has mostly wound down as far as the big market movers but there are still many companies dribbling out earnings reports. This coming week we have many companies that still matter which are due to release earnings and we would expect that these could be the big movers next week.

The top reports for the coming week are as follows: Focus Media Holding Ltd. (NASDAQ: FMCN); Corinthian Colleges Inc. (NASDAQ: COCO); H J Heinz Co. (NYSE: HNZ); Trina Solar Ltd. (NYSE: TSL); Williams Sonoma Inc. (NYSE: WSM); American Eagle Outfitters Inc. (NYSE: AEO); Applied Materials Inc. (NASDAQ: AMAT); Guess Inc. (NYSE: GES); Toll Brothers Inc. (NYSE: TOL); Energy Conversion Devices Inc. (NASDAQ: ENER); Krispy Kreme Doughnuts Inc. (NYSE: KKD); Omnivision Technologies Inc. (NASDAQ: OVTI); and Pandora Media Inc. (NYSE: P).

We have compiled previews using Thomson Reuters estimates, shown price data on each and added color if applicable.

Monday, August 22

Focus Media Holding Ltd. (NASDAQ: FMCN) has estimates of $0.37 EPS and $162.7 million in revenues; next quarter estimates are $0.43 EPS and $174 million in revenues. Shares are trading around $28.02 and the 52-week trading range is $17.71 to $37.58. So far, Focus has managed to avoid the China bashing trades because it is more established and investors believe that it is one of the real-deal companies. Valuations still remain high but that is because growth expectations remain here for the long-term.

Tuesday, August 23

Corinthian Colleges Inc. (NASDAQ: COCO) has estimates of $0.11 EPS and $427.6 million in revenues; next quarter estimates are $0.15 EPS and $427.02 million in revenues. Shares are trading around $2.36 and the 52-week trading range is $2.315 (hit on Friday) to $7,35. Just another down and out education stock.

H J Heinz Co. (NYSE: HNZ) has estimates of $0.76 EPS and $2.78 billion in revenues; next quarter estimates are $0.85 EPS and $2.89 billion in revenues. Shares are trading around $52.20 and the 52-week trading range is $45.52 to $55.00.

Trina Solar Ltd. (NYSE: TSL) has estimates of $0.47 EPS and $599.44 million in revenues; next quarter estimates are $0.60 EPS and $644.43 million in revenues. Shares are trading around $13.75 and the 52-week trading range is $12.75 (hit Friday) to $31.89. What can the solar sector look forward to right now?

Williams Sonoma Inc. (NYSE: WSM) has estimates of $0.36 EPS and $823.97 million in revenues; next quarter estimates are $0.39 EPS and $861.24 million in revenues. Shares are trading around $28.90 and the 52-week trading range is $24.57 to $45.48. It has been impossible to not notice the sell-off here in this cyclical retailer that does less-good in had times and scores in boom-times. The stock has suffered handily since July when Goldman Sachs raised its ratings in a solid outlook call.

Filed under: Calendar, Earnings, The Week Tagged: AEO, AMAT, COCO, ENER, FMCN, GES, HNZ, KKD, OVTI, P, TOL, TSL, WSM

Another Bruise in For-Profit Education Players (STRA, APOL, COCO, DV, EDMC)

Administrator — Thu, 28 Jul 2011 15:35:54 +0000

Publicly traded for-profit college stocks have been on a two-year roller coaster ride that looked like it was sorting itself out early in June. At that time, the US Department of Education ruled that its “gainful employment” rule would not take effect until 2015, a surprise ruling because most observers were expecting the rule to take effect immediately.

That announcement was followed earlier this week by the inclusion of an increase in Pell grants under both Republican and Democratic debt-ceiling proposals. That also boosted the sector. But today’s earnings report from Strayer Education Inc. (NASDAQ: STRA) may have tossed a wrench into the works. Higher costs and lower enrollments are pummeling Strayer stocks, down about -13% in early trading. Shares in Apollo Group Inc. (NASDAQ: APOL), Corinthian Colleges, Inc. (NASDAQ: COCO), DeVry Inc. (NYSE: DV), and Education Management Corp. (NASDAQ: EDMC) are all trading lower this morning as well.

Strayer didn’t perform all that poorly. The company reported EPS of $2.53/share compared with a consensus estimate of $2.39. Revenue of $163.8 million failed to meet an estimate of $166 million however. Operating margin fell from 38.6% in the same period a year ago to 30.6% and enrollment fell 8.5% year-over-year. New-student enrollment fell -21% and global online enrollment fell -12%.

Strayer’s 52-week trading range is $113.25-$241.76, and the stock closed yesterday at $143.25, a drop of -41%. Following the Department of Education ruling in June, Goldman Sachs raised the company’s target price from $137 to $151. Strayer’s shares trading today at around $124.50.

Short selling has been a hallmark of the sector for a while, as hedge funds have been betting against the schools due to their students’ poor loan repayment records. Shorts hold about 32% of Corinthian College’s float and about 23% of Strayer’s.

The Department of Education has reported that 12% of all higher education students are enrolled in for-profit colleges, that these students receive 26% of all student loans, and that 46% of all loan dollars are in default. The defaults are in large part attributed to the fact that graduates have poor luck getting a job after they finish their program.

New enrollments are the key to profits here. As long as the schools keep bleeding students they will also continue to bleed revenue and profits.

Paul Ausick

Filed under: Corporate Governance, Earnings Tagged: APOL, COCO, DV, EDMC, STRA

For-Profit Education Sees Massive Win in D.C. Loss (STRA, APOL, CECO, EDMC, COCO, ESI, DV)

Administrator — Thu, 02 Jun 2011 13:03:26 +0000

The final version of the regulatory acts against for-profit education companies is far less troublesome on the surface than what had been originally proposed. It is also far less stringent than many investors had feared. The Department of Education is now targeting a federal gainful-employment regulation that will effectively block federal aid to students with excessive debt at graduation who cannot get jobs that allow them to afford that debt. These institutions and their students must meet some employment benchmarks to quality for future federal aid. At least 35% of graduates must be paying their student loans. The other criteria is that annual loan payments must not be more than 30% of discretionary income nor more than 12% of a graduate’s total earnings.

For-profit education stocks are soaring on the news even if this seems harsh on the surface.

Strayer Education Inc. (NASDAQ: STRA) was called “in full compliance” by RBC… Shares are up 19% at $145.50 versus a 52-week range of $113.25 to $255.65.

Apollo Group Inc. (NASDAQ: APOL) is up almost 13% at $48.40 and the 52-week range is $33.75 to $53.61, but this hit $75.00 in late 2009.

Career Education Corp. (NASDAQ: CECO) is up 18% at $27.00 against a 52-week range of $16.36 to $28.57, but this was $35.00 in late 2009.

Education Management Corporation (NASDAQ: EDMC) is up almost 15% at $23.32 and the 52-week range is $7.76 to $23.19. This one came public in late-2009. BofA raised its rating today.

Corinthian Colleges Inc. (NASDAQ: COCO) is up 39% at $5.55 as its 52-week range is $3.76 to $13.16.

ITT Educational Services Inc. (NYSE: ESI) is up over 26% at $89.77 versus a 52-week range of $50.00 to $102.32.

DeVry, Inc. (NYSE: DV) is up almost 16% at $62.60 and its 52-week range is $36.34 to $59.53. This was a $70 stock just over a year ago. BofA raised its rating.

We always wondered throughout this entire process how and why these schools have not fought harder for more of the same scrutiny to be placed upon community colleges or other universities because many students emerge with student debt that can be higher than this. Many discount online degrees and for-profit education degrees, but in today’s job market it seems a bit pressuring to make these institutions live up to employment standards.

JON C. OGG

Filed under: Business Services, Compensation, Corporate Governance, Entertainment, Politics Tagged: APOL, CECO, COCO, DV, EDMC, ESI, STRA