ITT Educational Services Inc. signed up fewer students and saw fewer profits in the first quarter, but it still beat the expectations of Wall Street analysts.
The Carmel-based operator of for-profit colleges earned $85.4 million in the three months ended March 31, a 2.4-percent decline from the same quarter a year ago.
But ITT has boosted its earnings per share by buying back shares, including 2 million in the first quarter and more than 6 million in the last year.
That allowed the company to post earnings per share of $2.91, an increase from $2.46 in the same quarter last year.
Analysts surveyed by Thomson Reuters were expected earnings per share of $2.54 in the most recent quarter.
Enrollment of new students in the quarter fell 5.6 percent compared with the same period last year, to 21,761. Overall, ITT’s enrollment slipped 0.6 percent, to 84,030.
Fewer students contributed to a slight dip in revenue of 0.2 percent, for a quarterly total of $383.2 million. Analysts were expected revenue of $383.7 million.
Enrollment has been declining at for-profit colleges after the U.S. Education Department increased restrictions on recruiting. Beginning this year, the Obama administration will require for-profit colleges to ensure that at least 45 percent of former students are paying down their loans beginning four years after leaving school.
If schools’ former students fail to achieve that threshold, the government will not allow a for-profit education program to get student-loan funding to raise its enrollment levels. And if repayment rates fall below 35 percent, the government would cut off student-loan funding entirely for any new students.
Since the Obama administration announced the details of those new rules in July, ITT’s shares have lost a quarter of their value. They closed Wednesday at $66.05 apiece.
ITT stock surged by as much as 9 percent in morning trading. Shares traded at $68.79 each, up 4.2 percent, at midday.