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What: Shares of e-learning specialist K12
So what: The New York Times today contains a front-page story on online charter schools, specifically centered on schools run by K12. The multimonth investigation paints K12 in a very harsh light: "A portrait emerges of a company that tries to squeeze profits from public school dollars by raising enrollment, increasing teacher workload and lowering standards."
Now what: The Times hints at a coming collapse of the whole online learning industry unless these profit-grabbing practices are curbed. "These folks are fundamentally trying to do to public education what the banks did with home mortgages," says one expert in the story.
Negative sentiment has not spilled over into rival stocks DeVry
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