Shares of Santa Ana-based Corinthian Colleges Inc. got a boost on Wednesday after a Lehman Brothers analyst raised his price target on the vocational school operator’s stock on expected enrollment growth.
Corinthian shares rose about 8% at close of trading on a market value of about $1.2 billion.
The company, which runs more than 100 schools in the U.S. and Canada, offers degrees and certificates in healthcare, automotive technology, criminal justice, technology and other areas.
The jump in Corinthian’s share price comes after Lehman Brothers raised its rating on the education services sector to “positive” from “neutral,” calling Corinthian and other vocational school operators “defense performers” in a challenging economy.
When people’s employment prospects weaken in a tough economy, they consider training in other fields to make them more employable, according to Lehman.
Corinthian and other for-profit school operators should also benefit from the recent moderation of risks associated with student financing and credit issues, Lehman said.
The investment bank upgraded Corinthian’s share price from $15 to $16.
Corinthian’s shares now trade at about $14.
For the 12 months through June, Wall Street expects Corinthian to generate
$1.2 billion in yearly sales.
For the past few years, Corinthian has struggled with falling enrollment and more recently a shrinking number of student loans being made amid the credit crises.
