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What: Shares of American Public Education (NASDAQ:APEI) weren't making the grade today, falling as much as 17% after guidance in its third-quarter earnings report failed to impress.

So what: Unlike a number of for-profit educators that have struggled recently, American Public Education actually showed solid growth in the quarter, with overall enrollment up 17% and revenues up 18%. EPS was even with a year ago at $0.60, but that beat expectations of just $0.50. Last year's figure was also boosted by $0.10 due to a tax credit. Guidance for the company, which specializes in education for military and other public service employees, came up short, though, as management said new-student course registration would decline in the fourth quarter and EPS should only be between $0.64 and $0.67 a share, below analyst estimates of $0.73.

Now what: The market often punishes underwhelming guidance after an earnings beat, and this example's no different. APE saw flat growth in new-student registration in the third quarter, so the decline it projects in the fourth is a little unnerving. New students are the lifeblood of this industry; if the company can't turn that trend around in the next few quarters, that should be a red flag for investors.

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