FBR Capital Reiterates an 'Underperform' on Corinthian Colleges (COCO); Sacrificing Some Earnings for Some Regulatory Relief
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Price: $24.11 -0.33%
Rating Summary:
9 Buy, 3 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
Rating Summary:
9 Buy, 3 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 13
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FBR Capital reiterates an 'Underperform' on Corinthian Colleges (NASDAQ: COCO), PT $4.
FBR analyst says, "We are adjusting our model for COCO to reflect the company's new private loan program with ASFG, LLC. Although more costly than its existing program, we view the agreement as a longer-term positive for Corinthian as it helps alleviate some pressure from the 90/10 rule when the treatment of institutional loans changes in July 2012. Nonetheless, we do not expect meaningful flexibility under 90/10 to return in the near term given the company’s over-reliance on lower income students over the past several years. As a result, we believe enrollment and revenue growth will likely remain under pressure, and with expenses on the rise, earnings should remain depressed. There is no change to our Underperform rating or price target, as we still see limited upside potential from current levels."
"We are maintaining our FY11 operating EPS estimate of $0.93, but lowering our FY12 estimate to $0.29, from $0.35."
For more ratings news on Corinthian Colleges click here and for the rating history of Corinthian Colleges click here.
Shares of Corinthian Colleges closed at $4.24 yesterday.
FBR analyst says, "We are adjusting our model for COCO to reflect the company's new private loan program with ASFG, LLC. Although more costly than its existing program, we view the agreement as a longer-term positive for Corinthian as it helps alleviate some pressure from the 90/10 rule when the treatment of institutional loans changes in July 2012. Nonetheless, we do not expect meaningful flexibility under 90/10 to return in the near term given the company’s over-reliance on lower income students over the past several years. As a result, we believe enrollment and revenue growth will likely remain under pressure, and with expenses on the rise, earnings should remain depressed. There is no change to our Underperform rating or price target, as we still see limited upside potential from current levels."
"We are maintaining our FY11 operating EPS estimate of $0.93, but lowering our FY12 estimate to $0.29, from $0.35."
For more ratings news on Corinthian Colleges click here and for the rating history of Corinthian Colleges click here.
Shares of Corinthian Colleges closed at $4.24 yesterday.
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