Roger Lindsley

Inside Career Education Corp: Not All For-Profits Are Alike

Bottom line, Career Education (NASDAQ:CECO) is dependent on student enrollments for income. CECO's enrollments are declining faster than its stated forecasts. CECO's cash position continues to erode and regulators require a reserve in order to enroll new students. This conflict between enrollment trends and cash requirements presents a significant challenge to CECO's future in the medium to long term.

The bullet points on CECO

· Enrollments 2011 decline 18%, decline 2012 23%, expected decline 2013 25%.

· CFO O'Sullivan predicted 2% decline for 2013 in '12 Q4 and '13 Q1 conference calls. (O'Sullivan is a newly minted internal promotion without previous CFO experience.)

· CEO Steffey refuses to confirm enrollment projections for '13 in '13 Q2 conference

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details