QUOTE AND NEWS
DailyFinance  Apr 4  Comment 
TAMPA, FL -- (Marketwired) -- 04/04/14 -- Enviro-Serv Inc. (ESI) (OTC: EVSV) today announces that a new joint venture has been agreed upon for the Company's subsidiary, X-Terminate Pest Management, Inc., which will increase their fumigation...
DailyFinance  Mar 27  Comment 
VICTORIA, BRITISH COLUMBIA -- (Marketwired) -- 03/27/14 -- E. S. I. Environmental Sensors Inc. ("ESI" or the "Company"), (TSX VENTURE:ESV) is pleased to announce a non-brokered private placement of up to 10,000,000 units ("Units") at $0.05 per...
Benzinga  Mar 24  Comment 
In a report published Monday, Morgan Stanley analyst Suzanne E. Stein reiterated an Equal-Weight rating on ITT Educational Services (NYSE: ESI), but lowered the price target from $28.00 to $27.00. In the report, Morgan Stanley noted, “We...
Benzinga  Mar 24  Comment 
In a report published Monday, Bank of America analyst Sara Gubins reiterated a Neutral rating on ITT Educational Services (NYSE: ESI), but lowered the price target from $36.00 to $32.00. In the report, Bank of America noted, “After Friday's...
DailyFinance  Mar 13  Comment 
VICTORIA, BRITISH COLUMBIA -- (Marketwired) -- 03/13/14 -- E. S. I. Environmental Sensors Inc. ("ESI" or the "Company") (TSX VENTURE: ESV) is pleased to announce with its developmental partner Dycor Technologies Inc. of Edmonton Alberta, the...
StreetInsider.com  Mar 4  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/ITT+Educational+Services+%28ESI%29+to+Delay+10-K+Filing/9242293.html for the full story.
DailyFinance  Mar 4  Comment 
Electro Scientific Industries, Inc. (NASDAQ: ESIO), a leading supplier of innovative laser-based manufacturing solutions for the microtechnology industry, today announced it will be participating at two upcoming investor...
DailyFinance  Mar 3  Comment 
ATLANTA, GA -- (Marketwired) -- 03/03/14 -- LitWorks, A DTI Company, today scheduled its inaugural eDiscovery Specialist Boot Camp Training designed to expand attorneys', paralegals' and litigation support professionals' depth and breadth of...
SeekingAlpha  Feb 28  Comment 
By David Waldron: Executive summary: Bullish to industry trends, ITT Educational Services is growing new student enrollments YOY But the growth appears overly reliant on tuition discounting from a colossal scholarship program ...
Benzinga  Feb 27  Comment 
In a report published Thursday, Morgan Stanley analyst Suzanne E. Stein reiterated an Equal-Weight rating on ITT Educational Services (NYSE: ESI), but removed the $28.00 price target. In the report, Morgan Stanley noted, “We believe the...




 
TOP CONTRIBUTORS

ITT Educational Services (ESI) is the fourth largest for-profit university in the U.S., offering 35 degree programs to approximately 80,000 students, both online and at 124 campuses and 5 learning sites in 38 states. The company's revenue comes from tuition charges.[1] The company earned $1.3 billion in revenue and $300 million in net income in 2009.[2]

ITT Educational Services has traditionally focused on providing technology-related associate degree programs, but has expanded its offering to include an increased number of degree programs outside of technology in addition to a greater number of bachelor's degrees. Bachelors programs generate more revenue than Associate's degree programs because they are often 4-year programs versus 2-year Associate programs, and Bachelor's programs have greater tuition costs. To provide these new services, ITT has opened many new smaller branch campuses and learning sites.

Historically, enrollment at for profit educational institutions has increased during economic downturns as poorer job prospects cause prospective students to view continuing eduction more favorably. The global economic downturn has increased student enrollment and as a result, the company's net revenue increased by 30% in 2009.[2]

Company Overview

The ITT Technical Institutes offers 35 degree programs in fields in the following schools of study:[3]

  • Business: includes the fields accounting, business administration, financial services, marketing and advertising, and manufacturing
  • Drafting and Design: includes the fields computer-aided drafting, electrical and electronics drafting, mechanical drafting, architectural and construction drafting, civil drafting, interior design, landscape architecture, and multimedia communications
  • Electronics Technology: includes the fields electronics product design and fabrication, communications, computer technology, industrial electronics, instrumentation, and telecommunications
  • Criminal Justice: includes the fields corrections, security and policing, investigations, and cyber security
  • Information Technology: includes the fields network administration, technical support, network technology, and systems technology
  • Health Sciences: includes the fields nursing and health information technology

Student Demographics[4]

Age

  • 19 or less - 8%
  • 20 through 24 - 34%
  • 25 through 30 - 28%
  • 31 or over - 30%

Gender

  • Male - 75%
  • Female - 25%

Race

  • Caucasian - 49%
  • Other - 51%

Business Growth

FY 2009 (ended December 31, 2009)[2]

  • Net revenue increased 30% to $1.3 billion. The company attributes the growth to a 27.1% increase in student enrollment and a 5% increase in tuition rates.
  • Net income increased 49% to $300 million.

Trends and Forces

Capitalizing on Increased Demand for Education During Global Economic Slowdown

Historically, enrollment at for profit educational institutions has increased during economic downturns as poorer job prospects cause prospective students to view continuing eduction more favorably. People of all ages are going back to school to get a better job and increase their job prospects -- 30% of the university's students are over the age of 31, a 6% increase from the previous year.[4] ITT has been no exception from this trend. The global economic slowdown has increased their number of students and thus raised revenues. As a result, the company's net revenue grew by 30% in 2009.[2]

The U.S. Department of Education estimates that the post-secondary education market is worth at least $370 billion. The Department of Education estimates that nearly 40% of all students enrolled in post-secondary education programs are older than 24; 80% of Career Education's enrolled students are 'non-traditional' and older than 21. Over the next six years, the percentage of 18-24 year old students will increase by 16%, and the number of non-traditional students should grow at a similar rate.

Government Regulation and Financial Aid Policies Determine ITT's Fiscal Success

The post-secondary education market is highly regulated for any educational institutions that receive funding from the government; in ITT's case, government funding is in the form of financial aid programs that subsidize qualified students' education costs. Because 70% of ITT's annual revenue comes from Federal Education Financial Aid Programs, any significant change in policy for the various financial aid programs will affect ITT's revenue.[5]

Competition

The post-secondary education market is extremely competitive and not dominated by any single player. The United States has approximately 6,550 post-secondary education institutions:[6]

  • 2,730 private, for-profit schools
  • 2,000 public, non-profit schools
  • 1,820 private, non-profit schools

In addition to this extreme market fragmentation, the extensive accreditation process acts as a significant barrier to entry for new companies.

Of the other private, for-profit schools that target non-traditional students, Apollo Group (APOL) , DeVry University (DV), and ITT Educational Services (ESI) pose the greatest competition to Career Education.

Career Education (CECO) is a global for-profit university that offers associate, master's, bachelor's and doctoral degree programs in vocational areas such as business, communications and IT. The company had an enrollment of 116,000 students on 90 campuses in the the US, France, Italy, and UK.

Apollo Group (APOL) operates the University of Phoenix, the largest private, for-profit postsecondary education institute. They serve more than 355,800 enrolled students, at 102 campuses and 157 learning centers in forty states.

DeVry (DV) served approximately 130,000 students through its four subsidiary institutions - DeVry University, Ross University, Chamberlain College of Nursing, and Becker Professional Review. DeVry University is an undergraduate institution with more than 80 locations and the Keller Graduate School of Management. Ross University operates the Ross University School of Medicine and the Ross University School of Veterinary Medicine in Dominica.

References

  1. ESI 2009 10-K "Overview" pg.1
  2. 2.0 2.1 2.2 2.3 ESI 2009 10-K "Selected Financial Data" pg. 32
  3. ESI 2009 10-K "Programs of Study" pg. 3-5
  4. 4.0 4.1 ESI 2009 10-K "Student Admission and Retention" pg. 5-6
  5. ESI 2009 10-K "Federal and Other Financial Aid Programs" pg. 8-10
  6. CECO 2009 10-K "Industry Background and Competition" pg. 2-3
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