Apollo Education (Nasdaq:APOL) is about to release earnings. Ponder this Bear Case Scenario.
Currently 88% of revenue originates from government-aided loans, the University of Phoenix could easily exceed the 90% threshold, which could force program cuts.
Increased on-line competition will result in higher marketing and acquisition costs as all parties vie for qualified candidates; particularly in post grad studies.
Regulatory scrutiny only continues. Post grad student debt seems to be very high in relation to earnings ability. Value does not seem to be there so students blow off debt.
George Gutowski writes from a caveat emptor perspective.