DeVry Education Group Inc. (DV:US), the for-profit college operator, rose the most in 14 months after posting fiscal third-quarter profit and revenue that topped analysts’ estimates.
The shares gained 14 percent to $45.99 at the close in New York for the biggest daily increase since February 2013. The Downers Grove, Illinois-based company’s stock has climbed 30 percent this year, the most among the 13 members of the Bloomberg U.S. For-Profit Education Index.
While student signups at for-profit colleges have sagged in recent years because of competition and state and federal investigations, DeVry yesterday reported a 1.7 percent increase in total enrollment, led by gains in its health and Brazil divisions. Peter Appert, an analyst at Piper Jaffray Cos., raised his rating (DV:US) on the shares to outperform from neutral and his 12-month price target to $54 from $34.
“Continued strength in health/international units and signs of life at DeVry University suggest worst is behind us,” said Appert, who is based in San Francisco, in a note today to clients.
Sales dropped 1.5 percent to $496.1 million in the three months ended March 31, the company said yesterday in a statement. That beat the $493.1 million average of analysts’ estimates compiled by Bloomberg. Profit from continuing operations excluding some items was 87 cents a share, compared with an average projection of 75 cents.
DeVry said in February that it received a request from the Federal Trade Commission for five years of information related to its advertising, marketing and sales practices.
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