ITT Educational Services Inc.’s third-quarter profit of $93.2 million handily beat the expectations of Wall Street analysts, but the company suffered its first decline in new-student enrollment since the recession began.
The Carmel-based for-profit educator stands to suffer a bigger impact than its peers from new regulations proposed by the U.S. Department of Education, which have already forced the industry behemoth to slash its forecasts.
Investors fled for-profit college stocks Thursday after sector bellwether Apollo Group Inc. predicted a 40-percent drop in student enrollment next quarter and withdrew its forecast for next year. Carmel-based ITT Educational Services shares closed at $56.44 each, down almost 15 percent for the day.
Sardar Biglari has a penchant for self-promotion. But he's also making a good case for his management skills.
New student-lending rules proposed by the Obama administration could wipe out as much as two-thirds of profits at Carmel-based
ITT Educational Services Inc., some analysts believe.
Shares in ITT Educational Services Inc., based in Carmel, declined 13 percent Monday morning, to $56.02 each, after being downgraded
The Obama administration released a proposal that would tighten for-profit colleges’ access to federal student aid,
threatening an industry that received $26.5 billion in U.S. funds last year. Carmel-based ITT Educational Services
is among those potentially affected.
The Carmel-based operator of for-profit colleges saw its profit increase to $96 million in the second quarter, while enrollment
jumped 10 percent.
For-profit colleges like ITT Technical Institutes need tougher oversight and regulation, according to a report from a Democratic
Senate committee chairman that questions the industry’s advertising spending, tuition costs and reliance on taxpayer
money.
One-time events influenced bottom lines of some of the few companies that made more money in 2009.
ITT Educational Services Inc., Apollo Group Inc.’s University of Phoenix, Career Education Corp. and other for-profit educators
are under increasing federal scrutiny over their recruitment practices and the level of student loan defaults.
The administration is gearing up to produce tougher regulations that may reduce the amount of federal financial aid flowing
to for-profit colleges such as locally-based ITT Educational.
The Carmel-based operator of for-profit colleges pulled in profits of $85.7 million, or $2.46 per share, up nearly 44 percent
from the same quarter a year ago.
Former director says he saw employees give passing scores to students who had failed entrance exams, raise their grades and
alter their attendance records so they would continue to receive U.S. financial aid.
ITT Educational Services Inc., 13000 N. Meridian St., Carmel, 46032, www.ittesi.com, provides technology-oriented, post-secondary
education, including associate’s, bachelor’s and master’s degrees as well as non-degree programs.
ITT Educational Services and other for-profit educators are buying not-for-profit colleges to gain access to their regional
accreditation. The tactic could fuel rapid growth but makes critics uncomfortable.
The Carmel-based for-profit educator paid CEO Kevin M. Modany $7.6 million in total compensation last year, a 63-percent increase over 2008. And the rest of his management team all enjoyed pay increases of 45 percent or more.
ITT Educational Services Inc. reported higher profit in the fourth quarter of 2009, earning $2.56 per share. The Carmel-based
for-profit educator’s earnings topped analysts’ expectations.
Investors dumped shares of ITT Educational Services Inc. on Thursday morning as the company remained mute on its year-end
profit forecast while announcing that its bad-debt expenses were rising faster than revenue.
CEO Kevin Modany and his management team have become accustomed to regulatory uncertainty—and to growing the business
at a pace most executives can only dream about.
