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What: Shares of ITT Educational Services (NASDAQOTH:ESINQ) jumped as much as 12% today, riding a wave in the for-profit sector today, after industry peer DeVry (NYSE:DV) crushed estimates in its quarterly report.
So what: For-profit educators have come under a lot of pressure over the last year, as the Education Department has begun to scrutinize these schools, which often spend more on marketing than education, and leave students loaded with debt. ITT shares, for example, are still down over 70% from their price seven months ago. DeVry's report, however, may have put an end to fears of industry collapse. Revenue at the diversified educator dropped, but only by 3%, and per-share profits of $0.87 soared past Wall Street estimates of $0.56. Enrollments also increased at several of DeVry's schools.
Now what: ITT wasn't the only education stock to benefit from DeVry's knockout performance. Several for-profit educators were up, including Strayer, which gained 5.2%, and Career Education Corp., which jumped 10.5%. ITT fell off from its morning highs, to end with a 5.9% increase. In its own fourth-quarter report, ITT beat EPS by about 15%, hitting $2.08 a share on expectations of $1.81. ITT next reports earnings April 23.
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