Shares of ITT Educational (ESI -0.3%) "have gotten ahead of themselves" after beating "low...

|About: ITT Educational Services Inc. (ESI)|By:, SA News Editor

Shares of ITT Educational (ESI -0.3%) "have gotten ahead of themselves" after beating "low expectations," says Compass Point analyst Michael Tarkan in a note downgrading the stock to Sell from Neutral. "Persistence is declining, recruiting productivity in the industry has significantly deteriorated, and return to consistent enrollment growth will come at much lower price points," he adds. There are other concerns. On the call, Deutsche's Paul Ginoccio questioned how ESI could achieve its $50-75M free cash flow guidance with days sales outstanding at all-time highs. (transcript)