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Contrarian, event-driven, special situations, deep value

Class Is Back In Session - Career Education Corp. Offers Another Bite At The Contrarian Value Apple


Career Education Corp. (NASDAQ:CECO) operates a network of colleges, schools, and universities offering a variety of degree programs via online, ground-based, and hybrid learning program offerings. For-profit education stocks have been pummeled in recent years due to an unfavorable regulatory backdrop, heightened regulatory oversight and public scrutiny, accreditation issues, and various litigation, all of which have led to steep drops in enrollment and profitability. These issues were significantly compounded by a catastrophic recession and a horrible employment backdrop.

CECO has been no exception, as enrollments and revenues have fallen off a cliff over the last three fiscal years. Because the company's business model is utilization-driven and fixed costs are high (particularly in ground-based campuses), operating losses have...

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