) to neutral from overweight.
Analyst Bradley Safalow says his downgrade is based on view that onsite enrollment growth could continue to slow, bad-debt expense levels could remain inflated, and the lack of closure on potential finding of accounting problems by Special Committee could be an overhang.
He notes during the quarter, the company took a $18.9 million charge to boost allowance for doubtful accounts. While he was hopeful these charges would bring some closure to any potential accounting issues, at this stage he cannot says that with certainty.
Safalow says he exits the fourth-quarter results with more questions than answers.