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Barclays Maintains an 'Equalweight' on Apollo Education (APOL); Thoughts Ahead of 3Q'11 Results

June 30, 2011 1:15 PM EDT
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Price: $10.00 --0%

Rating Summary:
    5 Buy, 12 Hold, 2 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
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Barclays maintains an 'Equalweight' on Apollo Education (NASDAQ: APOL), PT lowered by $1 to $47.

Barclays analyst says, "Apollo Group is scheduled to report F3Q'11 results (6/30) after the market close. We expect a continued weak starts trend and accelerating margin contraction, and believe big fundamental upside to consensus estimates is unlikely (though aggressive share repurchases could drive a surprise). Our 3Q'11 expectations include: New student starts and total enrollment declines of 43% and 25% y/y, resulting in a 15% y/y revenue drop to $1,138 million. We estimate a 25.3% operating margin, down 785 bps y/y due to negative leverage from investments and declining sales. Our $1.18 EPS estimate (-32% y/y) is $0.15 below the $1.33 consensus estimate, though continued large sequential cost cuts and aggressive share repurchases could drive upside to our model."

For more ratings news on Apollo Education click here and for the rating history of Apollo Education click here.

Shares of Apollo Education closed at $43.02 yesterday.


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