DeVry Education Group Inc. (DV): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

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Summary:
DeVry's first-quarter 2015 earnings of $0.47 surpassed the Zacks Consensus Estimate by 51.6% and soared 113.6% year over year due to top-line growth and aggressive cost cuts. Sales increased for the second consecutive quarter and beat the Zacks Consensus Estimate. Except for DeVry University, the company saw positive revenue growth in all its institutions. Overall, DeVry is a high quality company. Its diversified portfolio of programs, regular strategic acquisitions and turnaround efforts give it a competitive advantage. Over the past two years, DeVry's health care and international businesses primarily drove its revenues and earnings. In fact, these businesses are expected to contribute a progressively larger portion of revenues/earnings in fiscal 2015. However, the core business the BTM segment accounting for almost half of the company's revenues, has been recording enrollment and sales declines. We, therefore, prefer to remain Neutral on the stock until we see sustained enrollment growth at DeVry University, not expected even in fiscal 2015.

Overview:

Headquartered in Downers Grove, IL, DeVry Education Group Inc. (DV) provides secondary and post-secondary education, primarily in the U.S., and also has operations in Canada, some Caribbean countries, Brazil, Europe, the Middle East and the Pacific Rim. The company's programs focus mainly on the fields of business, healthcare and technology. The company also serves accounting and finance professionals. The Illinois-based company is the parent company of American University of the Caribbean, Becker Professional Education, Carrington College, Chamberlain College of Nursing, DeVry Brasil, DeVry University (including Keller Graduate School of Management) and Ross University. Founded in 1931, DeVry reports its operating results under three segments:

Business, Technology and Management (BTM): This is the company's flagship segment and includes operations of the company's largest subsidiary, DeVry University. DeVry University offers graduate and undergraduate courses, both onsite and online, in technology, science, business and arts. The degrees offered are bachelor's and master's degrees. Graduate degree programs in management are offered through DeVry University's Keller Graduate School of Management.

Medical and Healthcare segment: The segment operates through DeVry Medical International (includes Ross University Schools of Medicine and Veterinary Medicine and American University of the Caribbean School of Medicine (AUC)), Chamberlain College of Nursing and Carrington College.


International and Professional Education: This segment includes operations of Becker Professional Review and DeVry Brasil. DeVry Brasil, which operates in the northeast region of Brazil, offers undergraduate and graduate programs in the fields of business management, medical, healthcare, law and engineering through its eight institutions at 13 campuses Fanor, Ruy Barbosa, REA1, Faculdade Boa Viagem (FBV), Faculdade do Vale do Ipojuca (Unifavip), Faculdade Differential Integral (Facid), Faculdade DeVry Sao Luis (Sao Luis) and Faculdade DeVry Joao Pessoa (Joao Pessoa). While majority ownerships in Fanor, Ruy Barbosa and REA1 were acquired in 2009, FBV, FAVIP and Facid were acquired in Feb 2012, Sep 2012 and Jul 2013, respectively.

Becker Professional Review offers professional exam review and training programs for many popular certification examinations like Certified Public Accountant (CPA), Association of Chartered Certified Accountants (ACCA), Chartered Institute of Management Accountants (CIMA) and many more. The segment also includes operations of ATC International and Falcon Physician Reviews which were acquired in Apr 2011 and Apr 2012, respectively.

The students who attend DeVry University, Ross University, Chamberlain College of Nursing or Carrington Colleges can finance their education through a variety of sources, including government-sponsored financial aid including Title IV funds, scholarships, employer-provided tuition assistance, veteran's benefits and private loans. However, those undertaking Becker review courses cannot avail of federal or state financial aid.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: CPA , ACCA , DV

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