For-Profit Educators Face Long Term Headwinds

Shares of for-profit educators have been on the upswing this month as the controversial "gainful employment" rules were finally published. Although short term sentiment has brightened in the industry, analysts remain concerned about the sector in the long run.

The Bedford Report examines the outlook for companies in the Education & Training Services industry and provides equity research on Corinthian Colleges, Inc. and Apollo Group, Inc. Access to the full company reports can be found at:www.bedfordreport.com/2011-06-07/STOCK-RESEARCH-ON-COCO

Last week the Education Department released its final rule prohibiting for-profit and professional certificate programs from accessing student-loan money if their former students aren’t able to repay the loans. If graduates owe too much relative to their income, or too few former students are paying back their tuition loans on time, schools stand to lose access to Pell grants and federal student aid. The regulations come in reaction to reports of high tuition charges, high pressure sales tactics, high dropout rates and job placements that don’t pay enough for students to pay back federally insured loans

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The Bedford Report

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