DeVry Education Group Inc (DV) Shares Plunge On FTC Lawsuit


It’s been a heck of a day for DeVry Education Group Inc’s (NYSE:DV) shareholders after the Federal Trade Commission announced that they are suing the company for deceiving students about the prospect of finding jobs after a DeVry education. The FTC is asking the company to stop making certain claims pertaining to the value of an education through DeVry.

“DeVry Group believes that the FTC’s complaint — filed 40 years after DeVry University began publishing accurate graduate employment statistics — is without a valid legal basis,” the company said in a statement.

The stock plunged at around noon ET as news of the lawsuit began to spread. Prior to the news, shares had been trading at around $23.50, but within a five minute time frame the stock dropped below $19.50 before being halted briefly.

The stock has fallen 16.43% or $3.9 following this negative news, hitting $19.84 per share. About 3.94M shares traded hands or 467.78% up from the average. DV has declined 29.91% since June 22, 2015 and is downtrending. It has underperformed the S&P500 by 21.04%.

From a total of 5 analysts covering DeVry (NYSE:DV) stock, 2 rate it a “Buy”, 0 a “Sell”, and 3 a “Hold”. This means that 40% of the ratings are positive. The highest target price is $38 while the lowest target price is $28. The mean of all analyst targets is $31.83 which is 60.43% above today’s ($19.84) stock price. DeVry was the topic of 9 analyst reports since August 19, 2015 according to the firm StockzIntelligence Inc. Barrington Research upgraded shares on September 21 to a “Outperform” rating. Standpoint Research upgraded shares to a”Buy” rating and a $32 target share price in their report from an August 21. Standpoint Research upgraded DV stock in a recent report from August 24 to a “Buy” rating.

The institutional sentiment decreased to 0.7 in Q2 2015. It’s down 0.01, from 0.71 in 2015Q2. The ratio is negative, as 34 funds sold all their DeVry Education Group Inc shares they owned while 74 reduced their positions. 20 funds bought stakes while 56 increased their total positions. Institutions now own 76.33 million shares which is 16.94% more than the previous share count of 65.27 million in 2015Q2.

Farley Capital Ii L.P. holds 32.43% of its total portfolio in DeVry Education Group Inc, equating to 1.50 million shares. International Value Advisers Llc owns 13.25 million shares representing 9.64% of their total US portfolio. Moreover, Paragon Capital Management Llc has 4.23% of their total portfolio invested in the company, equating to 358,950 shares. The New York-based Tiger Management L.L.C. has a total of 4.01% of their portfolio invested in the stock. Westport Asset Management Inc, a Connecticut-based fund reported 167,994 shares owned.

Since April 28, 2015, the stock had 0 buys, and 6 sales for a total of $1.20 million in net activity. Roselli John P sold 1,511 shares worth $38,138. Hamburger Daniel sold 26,754 shares worth $712,665. Jennings Donna sold 2,889 shares worth $77,288. Riehs Steven sold 5,079 shares worth $132,902. The insider Taylor Ronald L sold 25,000 shares worth $775,000.

DeVry Education Group Inc. is a well-known provider of educational services. The company has a market cap of $1.51 billion. DeVry Group’s institutions offer an array of programs in business, healthcare and technology, and serve students in postsecondary education as well as accounting and finance professionals. It has 10.84 P/E ratio. DeVry Group operates through three divisions: Business, Technology and Management, Medical and Healthcare, and International and Professional Education.