Shares of Corinthian Colleges Inc. got a boost early Wednesday after an analyst said the Santa Ana-based vocational college operator could benefit as more people return to school amid the slowing economy.
Citigroup’s Paul Beland upgraded Corinthian’s shares to “buy,” saying the company’s diploma offerings are “ripe for the unemployed.”
Corinthian runs more than 100 schools nationwide and in Canada, offering degrees and certificates in healthcare, business, technology and other areas.
The company has suffered from slower enrollment growth in recent months.
Corinthian’s growth prospects could make it attractive as an acquisition, Beland said.
“Our recent visit with management suggested the company is open to a deal if it is in the best interests of shareholders,” he said.
A deal isn’t likely before the company works through enrollment growth issues, the analyst said.
The comments are the best news Corinthian’s had in a while. Last month, the California Public Employees Retirement System put the company on a list of those with “dismal stock performance” and “poor governance practices.”
In the December quarter, Corinthian reported a big drop in profit for the second straight quarter as an effort to rework enrollment and tuition financing took its toll.
The company’s shares are flat for the year so far but are up about 15% from their fall low. Corinthian has a market value of about $1.2 billion.
