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What: Shares of online for-profit educator Capella Education
So what: For-profit education companies haven't exactly been surrounded by a supportive environment lately. The government has been putting on the squeeze, while enrollment has cooled considerably. To be sure, Capella's fourth-quarter report showed continued growth -- revenue was up 21% year-over-year while profit per share climbed 24%, even though it missed analysts' estimates by a penny. However, in its earnings release, management uttered the one word that never fails to make Mr. Market shudder: "uncertain." The company is unsure about demand, government regulation, and the competitive environment. What it's surer of, however, is that the first quarter isn't going to look all that hot, particularly when it comes to new enrollment -- the company sees it dropping 35% from the first quarter of 2010.
Now what: It's notable that this isn't simply a Capella issue; competitors like Strayer
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Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or on his RSS feed. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.
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