Capella Education Company
) recently received approval from the Higher Learning Commission
(HLC) for its two FlexPath programs - Bachelor of Science in
Business and Master of Business Administration (MBA). Capella
needs further approval from the U.S. Department of Education
before offering the programs to its students.
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The format followed under the FlexPath programs reduces the cost
and duration of the course. It also tailors programs according to
the requirements of the job market. Under the FlexPath model, the
assessment of a program is based on achieving the required
competencies and application of learning rather than on time
The company's FlexPath programs cater to the latest market demand
for short and cost-effective courses. This demand particularly
comes from working adults, who prefer to upgrade their skills
while maintaining their job. The recent approval of the FlexPath
programs is likely to contribute to new enrollment growth in the
Capella Education recently surpassed the Zacks Consensus Estimate
for earnings and revenues in the first quarter of 2013 on the
back of better-than-expected enrollment growth. New enrollments
grew 8.2% year over year, far exceeding management's expectation
of a 5% increase. Enrollments benefited from high-single digit
increase in bachelor degree enrollment, better-than-expected
performance in Master's degree enrollment and stabilizing demand
for doctoral programs.
Interestingly another education company,
Apollo Group, Inc.
) surpassed the top- and bottom-line estimates when it reported
its results for the second quarter of fiscal 2013 on Mar 25. We
believe that Apollo beat estimates on the back of cost savings
resulting from its restructuring efforts.
Capella carries a Zacks Rank #3 (Hold).
Education stocks such as
New Oriental Education & Technology Group
Grand Canyon Education, Inc.
) are currently performing well and are worth considering. New
Oriental Education & Technology Group carries a Zacks Rank #1
(Strong Buy), whereas Grand Canyon Education holds a Zacks Rank