For-profit education company DeVry Inc. (DV) saw its share rise more than 20% in pre-market trading after the company reported on Wednesday a better-than-expected second-quarter earnings report that easily beat the Wall Street views.
The Downers Grove, Illinois-based company reported a second-quarter net income of $50 million, or 78 cents per share, up from $9 million, or 13 cents per share, in the same quarter a year earlier. Adjusting for certain one-time items, EPS came in at 87 cents.
DeVry’s revenue was down about 4% to $505 million.
According to analysts polled by Thomson Reuters, the consensus view was that DV would earn 56 cents per share on revenue of $496.6 million.
The company has made a concerted effort to reduce expenses, like cutting $7 million from advertising and savings due to structural changes, which led to the spike in earnings despite a drop in revenue.
“The cost savings are being driven by structural changes made to these institutions, like revisions to staffing models, course scheduling and e-books,” CFO Tim Wiggins said in a post-earnings conference call with analysts. But he went on to add, “Looking to the third quarter, we now expect total costs and expenses to be up sequentially about 3 percent to 4 percent.”
More over, the company has been benefiting from a rise in enrollment at its Carrington Colleges Group segment, which caters to medical students, and Chamberlain College of Nursing.
DeVry shares were up $5.88, or +22.51%, during pre-market trading on Thursday. Over the past year the stock is down -33.23%.
The Bottom Line
Shares of DeVry (DV) have a dividend yield of 1.30% based on last night’s closing price of $26.12 and the company’s annualized dividend payout of 34 cents per share.
DeVry Inc. (DV) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.0 out of 5 stars.
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