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A New Era of Cash and Optimism in For-Profit Education


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Educational companies have seen their stock surge since the election. While the market as a whole has done well since Nov. 8, major companies including K12 Inc., Career Education Corp., DeVry Education Group Inc. and Capella Education Co. have grown faster than indexes. Laureate Education, Inc., which educates over one million post-secondary students in dozens of countries internationally, also concluded its (second) IPO in recent days. The company was publicly traded until 2007 when a group of investors took it private. Optimism and growth in the for-profit education market could mean changes to how the public thinks about higher education and career readiness. Many of the bigger higher education corporations tend to be more nimble in where they set up shop and more likely to build partnerships with business, said Guilbert Hentschke, a dean and professor emeritus at the USC Rossier School of Education. Many of the firms are focused on ensuring a local labor market is stocked with a stream of specifically accredited workers, compared to traditional non-profit four-year degree programs focused on the liberal arts. There are also signs of increasing collaboration between for-profit education companies and private non-profit institutions. Yesterday, Vanderbilt University joined with dozens of other schools in partnering with 2U Inc. to launch online degree offerings through its graduate school of education program. A big reason the for-profit education sector has seen renewed buoyancy in recent weeks is tied to the end of the Obama era. Hentschke, who is also affiliated with the Ernst & Young consultancy Parthenon-EY, said in an interview that the new administration and the new education secretary, Betsy DeVos, have not given a specific indication of their attitude toward for-profit education. Nevertheless, Trump’s business-oriented disposition and DeVos’s preference for free market fixes to the education system have not been lost on investors. The mere “absence of negative signals” represents a major shif

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