Street Slide: For-Profit Ed Stocks Plummet, Thanks to DeVry’s Forecast

DeVry Earnings ForecastFor-profit education companies on the stock markets have taken an early beating Tuesday in the wake of a gloomy forecast by DeVry (NYSE:DV). Many of the top for-profit  education stocks are caught in the undertow. Monday, DeVry modified its earnings forecast significantly lower, and the stock has been beaten to a pulp ever since – down nearly 28 percent from Monday’s close, to $20 per share.

As is usual with many industries, all it takes is one company to get (or give) a bad piece of news, and the entire industry suffers for it. Several other similar companies, like Apollo Group (NYSE:APOL) – down 3.5 percent; ITT Education Servies (NYSE:ESI) – down more than 7 percent;  Strayer Education (NYSE:STRA) – down 8 percent; Grand Canyon Education (NYSE:LOPE) – down 3 percent; and Washington Post Co. (NYSE:WPO) – down 2 percent, are feeling the pushback.

DeVry is the top-traded for-profit education stock on the Street, with more than 2 million shares trading hands daily. APOL has the largest market cap at $3.17 billion.

DV stock has been hammered since it announced a downgrade in its FQ4 forecast to an EPS of 43-46 cents per share on revenue of $500-510 million, down from consensus estimates of 78 cents per share on $516 million in revenue. The company stated that increased scholarship use and higher operational expenses as the cause for the downgrade.

This news is likely not being received well with several hedge funds, which have stepped up their stakes in DV stock in recent reports. At the end of March, for example, Ken Griffin’s Citadel Investment Group had increased its stock stake in DeVry by 88 percent to a value of $35.3 million, and Lee Hobson’s Highside Capital Management posted #30 million in new investment in DV stock by the end of the first quarter of 2011. John W. Rogers’ Ariel Investments had increased its stake by 28 percent to nearly $144 million to lead all hedges.

With APOL stock, Citadel increased its stake by more than 500 times during the first quarter to $83 million and Andrew Midler’s Standard Pacific Capital added 163 percent to its share hold to a value of nearly $79 million.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!