ForPro Education Shares are Down

Dr. Bill Belew

Issue III - June 25, 2006

Introduction by Mr. Stolyarov: Although the stock of many for-profit educational corporations has slightly declined recently, the quality of education they provide has not, writes Dr. Belew. Besides, this is no grounds on asserting for-profit services' educational inferiority to traditional colleges, because traditional colleges refuse to operate on a for-profit basis on principle; the financial data of the two types of schools thus cannot be compared. 

Apollo Group is the biggest of the ForPro education groups. It owns the University of Phoenix.

Yesterday its stock fell 2 percent after reporting lower third-quarter profits because of higher costs.

Corinthian Colleges is another of the big players. It, too, reported a loss of 3 cents/share.

DeVry lost 15 cents, and Educational Services lost 3 cents/share as well.

Everybody's trading down, albeit down very little.

Does this mean that the quality of education provided by these groups has also dipped? Are students losing out 2% on their classes? or 3 cents/dollar they spend on their tuition?

Hardly.

One of the big five -- Career Education Corporation -- reported gains of 2 percent. I reckon if they were all averaged out, it kind of breaks even.

Question: How did the traditional colleges do this last quarter?

Hmmm.... Nobody knows or will know until they come asking for money.

What do you think? 

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Dr. Bill Belew is a former Intelligence Officer for a Destroyer Squadron. He lived 20 years in Japan, where he started a language school for Japanese ECS. Dr. Belew teaches classes for a vocational school and online for a national university.

See Dr. Belew's blog, PanAsianBiz, for news and discussions about business and current events in Russia and Asia. See ZhongHuaRising for Dr. Belew's reports on business in China, RisingSunofNihon on business in Japan, and TheBizofKnowledge on business education.

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