Investing in "For Profit" Education industry

[DTEJD1997]

Hey all:

 

I've noticed that a lot of value investors are starting to get involved with the "for profit" education industry.

 

I had a couple of employees a few years ago who got wrapped up in this.  It was shocking how bad it was for them.  They were going to a Washington Post school.  The report "Subprime Comes to Education" was not too far off the mark.

 

With that being said, value guys are getting in to this industry.  They note that some companies are trading for their cash balances.

 

I'm thinking it is a value trap.  There are several risks:

 

A). The government cracks down, and the schools no longer are able to get student loans.

B). The schools lose accreditation.

C). The schools are overwhelmed by lawsuits from former students.

D). The schools are overwhelmed by lawsuits by state AG.

E). The schools can't cut expenses fast enough.

F). The population finally wakes up to what is going on...

G). Something else goes haywire...

 

I was reading a report on the University of Phoenix the other day.  The report stated that 1% of students who are going full time for their BA get it within 4 years.  7% graduate within 6 years.  13% graduate within 8 years.  I was shocked the numbers were that low.

 

On a slightly different note...I am noticing an EXPLOSION in MBA programs.  I think in my city there are AT LEAST two dozen schools offering night/weekend/ "executive" MBA programs.  I checked into a couple of them and was shocked by how expensive it was.  When everybody has an MBA, what is it going to worth?

 

Any thoughts?

[netnet]

I completely agree.  I would add the MOOC's are also a threat.

 

Buffett's quote comes to mind: you only know who is naked when the tide is going out.  The tide is really going out on these companies, structurally and cyclically.  I think that some of them are going to be zero's.

[DTEJD1997]

I am certainly VERY critical of education...

 

HOWEVER, I don't have a problem per se with "for profit" education.  Let them charge WHATEVER they want!  I hope they become wealthy beyond the dreams of avarice.

 

HOWEVER, they have to tell the truth, students have to have a good outcome.  If they are charged $100k for a degree, there better be a pretty good chance of them graduating and getting a job that makes it worth it.  If the students can't get a job, or their degree is worthless, they better make that known before you sign up. 

 

One thing that I've never been able to figure out...is if education is such a good deal, why does the government have to make the loans?  Let the schools make the loan.  If they have a good product, they should not have a problem getting paid back.  They should also be able to charge a modicum of interest, say 4% or 5%...I've heard stories of student loans being at 12% or 14%!

 

Yes, I think there is going to be tremendous change coming to this industry...

[ItsAValueTrap]

There are a lot of companies out there selling books, training videos and putting videos up on Youtube.  I think that segment of the for-profit education system is *extremely* healthy.  I taught myself computer programming from a book (and have made money freelancing doing image processing / computer programming work).  I think that most of the value creation for society occurs with the companies putting out books and DVDs and websites.

 

As far as programs that give a degree, there are many programs that don't spit out students with employable skills.  You can study a lot of silly things at publicly-funded universities and colleges.  (This is my jaded opinion.)  You can do the same with private colleges too.  I think that the for-profit private education sector will still be around even if it doesn't deliver value.  There are people who out there who are looking for an "easy" way out.  They hope that formal education is a ticket to a job.  Look at countries that don't subsidize private education as much as the US... here in Canada, some people do go to private colleges (and waste their money).  And a lot of people go to public universities and waste their money.  And some kids go to school for sexy and interesting programs (e.g. film) while their rich parents pay for their education.

 

Maybe there is value in the innovators in the private education sector (University of Phoenix was a pioneer; then they jumped onto the milking subsidies bandwagon).  Devry has a "good" brand. 

 

Full Sail, while not publicly traded, is an example of a private college that will likely stick around.  Full Sail will always have lots of students applying because they offer a sexy and interesting program.  While a film school education is a bad investment no matter where you go, Full Sail has one of the best programs around (or least worst).

[ItsAValueTrap]

Let the schools make the loan.

I think the reason why this doesn't happen is because:

1- A college/university education is often a poor investment, though this depends on the program and field.

2- Colleges/universities will likely be terribly at handling things outside their core competencies.  Managing credit risk and being good at convincing people at repaying are very specialized things.  There are many (public) financial companies that only do lending or only do debt collection.

 

There *are* banks that do give student loans to medical students.  This suggests that med school is a great investment.  I would infer that if banks don't offer a loan for a particular program, that program probably doesn't offer great value to the student.

[DCG]

I taught myself computer programming from a book (and have made money freelancing doing image processing / computer programming work).

 

not to side-track this tread, but what book did you use? I've been thinking about learning some programming.

[Icarus]

I think a lot of the for profit education schools take advantage of people who think any college education is an automatic ticket to success. College is just the beginning and if the school can't open any doors and companies don't hire from them then there is no point in going based on ROI. Knowledge is so readily accessible with the internet that you can teach yourself skills without going to college.

 

That said, college was a good experience for me and maybe people subtract the price of a 4 year vacation to calculate the ROI.  :)

[infinitee00]

Hey all:

 

I've noticed that a lot of value investors are starting to get involved with the "for profit" education industry.

 

....

I'm thinking it is a value trap.  There are several risks:

 

A). The government cracks down, and the schools no longer are able to get student loans.

B). The schools lose accreditation.

C). The schools are overwhelmed by lawsuits from former students.

D). The schools are overwhelmed by lawsuits by state AG.

E). The schools can't cut expenses fast enough.

F). The population finally wakes up to what is going on...

G). Something else goes haywire...

 

....

Any thoughts?

I wrote this out yesterday but forgot to post it. I am not sure what your question is. Are you trying to establish a long or short position in a particular company or trying to get a broad idea about the industry?

 

The for-profit education industry has been beaten down pretty badly in the last few years since Eisman's talk and may be beaten down further. I also think their prospects for near term future growth (i.e in the next 3-5 years) may be small to non-existent. Their business model is undergoing change and their profitability will suffer but I don't see them disappearing altogether. In fact I expect the stronger ones to adapt to the new rules and survive and perhaps even thrive.

 

You can get a good idea on the industry from the senate investigation report : http://www.propublica.org/documents/item/407797-help-senate-report

 

Also if you are looking for an overview of specific colleges you can check this link out : http://www.help.senate.gov/imo/media/for_profit_report/Contents.pdf

 

The reason for my tepid optimism stems from the following observations

 

*  Academic inflation (http://en.wikipedia.org/wiki/Academic_inflation)  - The need for more college educated and qualified job applicants, (not only in the US but also all around the world), has driven higher student  enrollment (http://tinyurl.com/bneguts)  and higher graduation rates in the US (http://tinyurl.com/bvzakch) during the past few decades ( sorry, couldn't find a better chart). Unless something fundamentally changes with the employment market like a deep and protracted recession or a sudden huge need for unskilled labor, I don't see this trend reversing anytime soon. Also note that not only is the % of graduates increasing but the US population is also increasing which means that from a purely numerical point of view, there will be more graduates in the coming decades leading to more competition for jobs.

 

* This increased demand for college education cannot be fulfilled by the present non-profit or public higher education infrastructure in the US (check senate report above). Given the cutbacks to govt. spending in higher education during the last decade (which will probably increase in the coming years given the state of the US budget), I doubt that public educational institutions can expand enough to accommodate the ever increasing number of students seeking college degrees. So, students looking to get a college degree and unable to secure an admission to a public university or community college will inevitably turn towards the for-profit colleges.

 

Moreover, on a related note, if you look at the history of the for-profit education sector then you will find that for-profits came into existence because there were a real demand for certain types of degrees and courses not offered by the public university system. By endeavoring to fill that gap or hole and offering degrees that the public universities did not or offering courses to certain demographics that were not served well by the public universities, for-profits have justified their existence and built a viable business model. As long, as this gap is present and public universities are unable to fill that (which I think is as true now as it was 30-40 years ago), for-profits will survive and thrive. Yes, they would have to clean up their act and offer better courses, better quality educators and stop their dubious practices but once they clean it up, I think they will be in a better position than they are now.

 

After the financial crisis (FC), some talking heads prophesied (http://www.nytimes.com/2009/01/18/business/18gret.html?_r=0) that the FC will bring an end to the banking model as we know it. However, we know today that the FC did not put an end to the model. Yes, it’s true that leverage in the banking system has come down, capitalization ratios have improved, headcount has been reduced but the basic model has remained pretty much the same. Even the use of CDOs and CLOs are back (http://www.cnbc.com/id/100422439) and the reason for that is simple - supply and demand.

 

So, as long as there is a demand for college degrees and supply of public/non-profit colleges limited, for-profit colleges will continue to offer degrees and students will continue to attend them (irrespective of their cost or quality compared to public universities).

 

In fact, I think increased scrutiny from the government and regulation will be better for their long term survival, similar to what the banking sector has been witnessing  – short term pain but long term gain. It will force them to clean up their act, change their dubious business practices w.r.t admissions/enrollment, strengthen their balance sheets, try and offer more focused courses towards certain vocations that that the public colleges do not or cannot offer, hire better professors, pay more attention to the quality of their courses and improve their placement services.

 

As for the risks you mentioned, here’s what I think- with about a trillion dollar in educational loans outstanding, I will be very surprised if Congress passes any law allowing students to file bankruptcy and wipe out their burdensome student loans completely. It is possible that future laws may help reduce the interest rate or term of the loans or make the covenants more lenient. However, given that student loans are secured loans and not unsecured like credit card debt, they have no reason to do so unless there's riot on the streets. Congress and the financial institutions might argue that allowing students to wipe out their debt entirely may put the banks and lending institutions in financial jeopardy which may in turn affect the stability of the ‘system’ (and I don't have to tell you which side has more lobbying power and political influence). 

 

As for the other risks of reducing grants, I think there is a high possibility grants will be monitored closely and reduced but not to any extreme. There will still be enough left for the better for-profits to earn a decent return on capital. The loss of accreditation is again possible but I think barring a few, most for-profit colleges will keep their accreditation. Consider the fact that the for-profit education industry employs thousands of people (http://tinyurl.com/c2dhbec) and politicians are generally reluctant to jeopardize the employment opportunities of so many, especially in such a high unemployment climate as today. An example of the reluctance of government in implementing or enforcing mass prohibition/bans can be observed from the history of asbestos industry or tobacco industry. In spite of the proven harmful effects of asbestos or tobacco on the human body, the government has not acted to prohibit or ban either. So, I am pretty confident that sweeping actions from the government that has the possibility of forcing an entire industry out of existence are highly unlikely.

 

The risk of lawsuits is ever present for any corporation, so I think that risk is a real. But considering that there hasn’t been a *major* class-action lawsuit filed against any for-profit college since these allegations came forth 2 years back, the chances of massive class-action lawsuits diminish with every passing day. I am not saying it cannot happen but that the probability is lower than it was in 2010. Even if there were lawsuits, I doubt the industry as a whole will be driven out of existence. Given the nature of the allegations, some of them may be crippled for good, but majority of them will survive.

 

 

 

 

[infinitee00]

I completely agree.  I would add the MOOC's are also a threat.

 

 

I know that this view is common amongst a lot of people but I would disagree with that notion.  Many people believe that the present wave of MOOCs or Massively Open Online Courses (e.g. courses offered through websites like Coursera.org) is going to ‘massively’ disrupt the centuries old education system and drive every college and every university on this earth, including for-profit colleges, the way of the dodo. I presume they hear the world ‘online’ and immediately start drawing parallels to retail and online entertainment – the new kids on the block Amazon and Netflix driving the tottering geriatrics like the Borders, Circuit Citys and Blockbusters of the world out of business. I do not deny that the influence of MOOCs will increase over time but in my opinion the threat has been highly overblown by most. Here is why

 

1. Many educated and smart people assume, albeit based on their own experiences, that online delivery of courses followed by self-study at a more leisurely pace is a superior method of imparting knowledge. Yes, it's true if you are a driven individual and want to extend your skill-set or knowledge. However, that assumption is, in my opinion faulty when it comes to the general population. It assumes a one-size-fits-all model of education. A little knowledge and understanding of the human mind and experience with different types of student will show that what is right for Peter may not be right for Paul. While some students may thrive at self-study other may need more hand-holding and more attention. MOOCs by their very nature are incapable of achieving that task (at least with the present state of technology) and here a more personal interaction between a student and a teacher would be far more beneficial in achieving that goal (As a special case think about students with developmental disabilities. Can MOOCs be suitable for them too?)

 

2. If you ignore the ‘massively open’ part of MOOC, the concept of online education is nothing new. Virtual classes were being offered by universities as far back as 1984 (http://www.nyit.edu/about_nyit/nyit_at_a_glance/history/)(when American Open University offered their first virtual course). The present incarnation of teaching classes with video lectures over the internet has been there for almost a decade now. It is seen more of a way of complementing classroom education rather than an entire new method of imparting education. I do not think that notion has changed with the addition of 2 more words in front of them. Just because it reaches a larger number of people and they can take courses from the convenience of their homes does not make classroom teaching obsolete.

 

3. Let’s think about the MOOCs from the perspective of degrees or courses that require physical effort and presence – Culinary arts, carpentry, plumbing, electrical technician, nursing etc. Can MOOCs effectively teach these courses? The answer should be obvious yet these are very real courses being offered by both non-profit and for-profit colleges. Can we see them disrupting the status quo in those fields?

 

4. Next let’s consider this question from a recruiter’s or job applicants’ perspective. Say I am a fresh graduate of ‘World’sBestMOOC University’ (lame name, I know!!) where I completed all my courses online and received a 4.0 GPA. Now when I send my resume to a company looking to hire fresh graduates, what do you think the reaction will be of the person reading my resume? The first question he/she will wonder is whether I completed the coursework and exams myself or hired another smart student to do it for me. How does that person ensure that I didn’t cheat in my exams or outsourced my test-taking to some smart kid in India or China? I doubt if I will even get an interview to prove my knowledge or skills. The very fact that I have to convince potential recruiters that I honestly earned my entire degree online would put me in a very disadvantageous position w.r.t to other candidates. How many students will take that risk and pay big money to even pursue that path? How many companies or hiring managers will take that chance? How many universities or colleges will ensure or vouch for that? I doubt very few.

 

I am not aware of any present technology that can verify that a person is actually attending the course or taking the exams herself, short of forcing the student to sit in front of a camera (and even that can be hacked or manipulated) which then defeats the purpose of the online course. So unless the definition of ‘earning a degree’ changes I do not see how MOOCs can dominate the world

 

5. Lastly let’s consider the question of brands. Universities are very aware of the power of their brands and are very sensitive and protective of it. They want to recruit the best students and allow the best students to graduate so that they can further enhance their brand image. MOOCs on the other hand, are by their very nature, egalitarian (some tea-party nut-job may even accuse them of being “socialists” ;-)).

 

Consider for a minute what will happen to the brands of these universities if anyone with a laptop is able to earn a degree. What will a Harvard MBA or MIT PhD be worth if every Jack, Jill and Joe can earn a Harvard or MIT degree? Do you think it will be worth it for students to spend a small fortune and earn their degrees online when they know that others can do it too? Again the answer should be obvious.

 

I agree that the lower end of the education spectrum (not particularly influenced or dependent on brands) may be hurt by MOOCs and for-profits may very well see their business diminish, but again I do not think it will be to the extent people project them to be because of the points 1,3,4 above.

 

In conclusion, I must say that I do not have a crystal ball and do not know what will happen 10-20 years from now. But given the way formal education is sought, imparted and rewarded, I see it unlikely that MOOCs will be massively disruptive as people consider them to be.

 

[Josh4580]

"In conclusion, I must say that I do not have a crystal ball and do not know what will happen 10-20 years from now. But given the way formal education is sought, imparted and rewarded, I see it unlikely that MOOCs will be massively disruptive as people consider them to be."

 

Agreed.

 

[netnet]

 

I know that this view is common amongst a lot of people but I would disagree with that notion.  Many people believe that the present wave of MOOCs or Massively Open Online Courses (e.g. courses offered through websites like Coursera.org) is going to ‘massively’ disrupt the centuries old education system and drive every college and every university on this earth, including for-profit colleges, the way of the dodo. --

 

You are undoubtedly correct here.  History doesn't repeat; it does rhyme though ;)

 

MOOCs by their very nature are incapable of achieving that task (at least with the present state of technology) and here a more personal interaction between a student and a teacher would be far more beneficial in achieving that goal (As a special case think about students with developmental disabilities. Can MOOCs be suitable for them too?)

Some community colleges (and High Schools!) are using the course materials already.  This is may be how it is going to work.

 

If you ignore the ‘massively open’ part of MOOC, the concept of online education is nothing new. Virtual classes were being offered by universities as far back as 1984 (http://www.nyit.edu/about_nyit/nyit_at_a_glance/history/)(when American Open University offered their first virtual course). The present incarnation of teaching classes with video lectures over the internet has been there for almost a decade now

.  And Japanese cars and transistor radios were around in the late 50's too.  These things take time.  Now, other people and institutions can employ the courseware.

 

 

Let’s think about the MOOCs from the perspective of degrees or courses that require physical effort and presence – Culinary arts, carpentry, plumbing, electrical technician, nursing etc.

  Again, you can have the absolutely best in the field of nursing or medicine or... be at your community college, via the internet.

 

Next let’s consider this question from a recruiter’s or job applicants’ perspective. Say I am a fresh graduate of ‘World’sBestMOOC University’ (lame name, I know!!) where I completed all my courses online and received a 4.0 GPA.

Against this I will give you two data points:

[*]Recruiters already higher off of hacking contests online, so you are wrong on that count

[*]Some of the best grades on an advanced electrical engineering course were not at Stanford, and recruiters are interested!

 

I am not aware of any present technology that can verify that a person is actually attending the course or taking the exams herself, short of forcing the student to sit in front of a camera (and even that can be hacked or manipulated) which then defeats the purpose of the online course.

It's already happening, online proctoring, keystroke logging, etc.

 

Lastly let’s consider the question of brands. Universities are very aware of the power of their brands and are very sensitive and protective of it.

  The best universities are not cheapening their brands; they are putting stutff out on the web.  Remember all of them have extension classes too!

 

 

I agree that the lower end of the education spectrum (not particularly influenced or dependent on brands) may be hurt by MOOCs and for-profits may very well see their business diminish, but again I do not think it will be to the extent people project them to be because of the points 1,3,4 above....  In conclusion, I must say that I do not have a crystal ball and do not know what will happen 10-20 years from now.

Drucker once said, he did not predict the future; he just looked out of the window.  The changes are already happening.

[netnet]

I taught myself computer programming from a book (and have made money freelancing doing image processing / computer programming work).

 

not to side-track this tread, but what book did you use? I've been thinking about learning some programming.

 

To what purpose are you learning to program?  The intellectual exercise of CS?  You want to get in there and code.  You want to see what those guys in IT are trying to put over on you?

 

Here is an interactive ebook on Python, which is a good language to learn pedagogically and is quite useful in the real world: http://interactivepython.org/courselib/static/thinkcspy/index.html.  The book also covers some aspects of CS as an intellectual exercise as well.  It does not really go into what is happening "under the hood" however, if that is of any interest.

[infinitee00]

Some community colleges (and High Schools!) are using the course materials already.  This is may be how it is going to work.

 

Yes, you are right, and that brings me to what I have been trying to say - MOOCs will just be an extension of the existing framework. Not a replacement.

 

And Japanese cars and transistor radios were around in the late 50's too.  These things take time.  Now, other people and institutions can employ the courseware.

. 

 

I am not sure I understand your point here since I see both Japanese cars and radios still in the market. Sharing or using online courseware is fine and is nothing new but that won't make traditional education obsolete.

 

Again, you can have the absolutely best in the field of nursing or medicine or... be at your community college, via the internet.

 

 

If you have to be at your community college then it pretty much defeats the purpose of the MOOC isn't it? I don't see the difference between being physically at a particular location and being taught online by an instructor as opposed to being taught physically by an instructor in the classroom. This may help achieve scale for sure and bring down cost but again it is not a replacement for brick and mortar education. 

 

Against this I will give you two data points:

[*]Recruiters already higher off of hacking contests online, so you are wrong on that count

[*]Some of the best grades on an advanced electrical engineering course were not at Stanford, and recruiters are interested!

 

You are viewing MOOCs from the narrow point of view of Computer science or even parts of electrical engineering and then extrapolating that to everything. Yes, I fully agree with you that anything that can be done on a computer can be transferred online and taught/evaluated there ( to a certain degree). But how about those degrees that need building or handling physical stuff - Mechanical/Civil/Chemical/Biomedical engineering or Architecture/Medicine/Nursing. Can you imagine a doctor getting his degree online? Will you be visiting that doctor anytime soon?

 

 

It's already happening, online proctoring, keystroke logging, etc.

 

Here's where I see problems with those ( given technology available today)

 

1. Both can be hacked or circumvented easily to believe the student is actually taking the test

2. Privacy issues

3. Cost of implementation

4. Collusion between test taker and proctor opening this up to potential bribery issues

5. Dependence on high quality and unbroken internet connection or power source both at student's end and proctor's end.

 

Given all of these above, I doubt they will catch on as a serious means of evaluating students without serious changes on the political, legal and technological front.

 

 

 

The best universities are not cheapening their brands; they are putting stutff out on the web.  Remember all of them have extension classes too!

 

 

And thats exactly what I have been saying all along ! :D

 

Drucker once said, he did not predict the future; he just looked out of the window.  The changes are already happening.

 

Change is great and I welcome it. However I am willing to speculate that innovation will not be enough to overcome the barriers of classroom education for *every* subject. But then again difference of opinion is what makes the market, isn't it?

[netnet]

The difference of opinion does indeed make a market. 

 

I realized that this a different thread than the one where I made my full arguments. Basically, I think that MOOC's will really hurt the for profits and the bottom quarter, aka overpriced podunk U of the non-profits.

 

The technical problems of proctoring are way closer to being solved than the bribery/falsification issues out of some foreign universities--China, Iraq and Iran specifically. 

 

I have focused on computer science, but many professions require only screen interactions.  And I wish more radiologists in fact had more training in front of a computer.

 

My point about the radio and cars was, following Christensen's model of disruptive technology, the MOOC's are here, and will first change the bottom of the market. (Meaning that they really are going to change many things, but most probably unpredictably.)  To this point, having MOOC's at community colleges is really going to hurt the teachers there.  Instead of inexpensive PHD's and Masters, there will be really cheap grad students at these schools.  It will drive down costs there.  Then the question becomes why go to Podunk U?

 

 

[JEast]

My 2¢.  The space looks interesting and has potential in areas that teach a hard trade like HVAC, Auto Repair, Nurses, and the like.  At least when classes are finished in these programs, you are almost guaranteed a job unlike some bachelor certificate programs.  There were a couple of interesting opportunities late last year, in this space but they have all run up to date resulting in nothing of interest through my filter presently.  A couple are on the radar but they need a 30-40% pullback from current prices.

 

Cheers

JEast

[infinitee00]

 

I realized that this a different thread than the one where I made my full arguments. Basically, I think that MOOC's will really hurt the for profits and the bottom quarter, aka overpriced podunk U of the non-profits.

 

 

Absolutely ! If you look at my comment above (#7) I fully agree that the bottom line of the for-profits will suffer in the near term. No question about that. But I also think that the strongest amongst them will adapt, trim excess fat, change their business practices and possibly even thrive because they fill an important gap in the education sector that I do not see being filled by the non-profit/public education system.

 

Btw, can you please post a link to that thread. You have made some good points and I welcome contrary opinions.

 

The technical problems of proctoring are way closer to being solved than the bribery/falsification issues out of some foreign universities--China, Iraq and Iran specifically.

 

Even if it solved on the technological front, the legal/political/infrastructural and cost issues will still remain, which is why I do not believe that it is going to be widely adapted ( the operative word here being 'widely'). Yes they may be solved eventually but I don't see them happening in the next few 5-10 years ( my typical investment horizon).

 

Btw you have piqued my interest and I am genuinely curious about this.  If it's not too much trouble can you please post links/papers to how researchers are handing these challenges and solving the issues ?

 

To this point, having MOOC's at community colleges is really going to hurt the teachers there.  Instead of inexpensive PHD's and Masters, there will be really cheap grad students at these schools.  It will drive down costs there.  Then the question becomes why go to Podunk U?

 

Point taken and I agree, with the caveat that lower profits != death of for-profits.

[prevalou]

for those interested, an interesting shareholders letter from Robert Silberman, who worked at Berkshire Hathaway:

 

http://files.shareholder.com/downloads/STRA/2320997447x0x649545/eb557681-4e63-4466-bda3-c01b0409ea57/2012.pdf

[Guest hellsten]

for those interested, an interesting shareholders letter from Robert Silberman, who worked at Berkshire Hathaway:

 

http://files.shareholder.com/downloads/STRA/2320997447x0x649545/eb557681-4e63-4466-bda3-c01b0409ea57/2012.pdf

 

Thanks. Interesting and educating letter. Too bad Silberman is leaving…

 

STRA is not paying a dividend this year, which seems weird to me since they are not even opening any new campuses in 2013.

 

I wonder what the catalyst is for higher prices in this sector?

 

JEast, would you mind sharing the companies you mentioned you have on your radar?

[prevalou]

two points:

 

1) Silberman is not leaving: he will be responsible for capital allocation (an important function according to the book OUTLIERS...)

 

2) there is no dividend in 2013 but an important shares repurchase programm

[BargainValueHunter]

http://finance.yahoo.com/news/career-education-sells-business-more-224339961.html

 

Career Education Corp said it will sell its European education business to private equity firm Apax Partners for about $305 million, sending its shares up more than 50 percent in extended trading on Thursday.

 

The deal - valued at more than Career Education's market capitalization - includes its entire international schools business, comprising the Paris-based INSEEC Group and the International University of Monaco.