For-Profit Education Surge

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During the second half of 2012, “for-profit” education companies (the ones such as ITT Technical Institute that advertise on television all the time) were getting pummelled. The basic story was that the graduates from these “colleges” were pretty much unemployable, and thus unable to pay back their (huge) Fed loans. The Feds were getting sick of it and started to clamp down, so COCO, ESI, DV, and many others plunged.

I have no idea what magical change has taken place (perhaps the Feds, as usual, got soft again) but these shady firms are soaring again. They may not be quite safe to short again, but I don’t have long-term faith that these organizations generate true value for their students, so I think that, over the long haul, they’re going to get monkey-hammered.

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