Career Education Corp. (CECO) recently reported results for the fourth-quarter of 2009. The company recorded a GAAP net income of $30.7 million, compared to $31.2 million in the year-ago period. Excluding discontinued operations, earnings per share came in at 72 cents, which surged past the Zacks Consensus Estimate of 32 cents.
The company has a good track record of beating earnings expectations as it has topped the Zacks Consensus Estimate in 3 of last 4 quarters with an impressive average positive surprise of nearly 90.6%, or 21 cents. This implies that Career Education’s earnings has surpassed the Zacks Consensus Estimate by 90.6% on an average over the last 4 quarters.
For the full fiscal 2010, the Zacks Consensus Estimate has climbed 3 cents in just the past week to $2.00 per share as 3 of 15 covering analysts raised expectations. The most accurate estimate is more bullish at $2.09 per share indicating an upside potential of 4.5% over the Zacks Consensus Estimate.
During the reported quarter, Career Education recorded a strong 19.4% growth in revenues to $507.8 million from $425.3 million in the prior year quarter. The expansion was mainly driven by a 21% growth in total student population to 116,800, which included a 27% growth in online enrolments to 46,200 students.
Total operating expenses rose by 9.4% year over year to $410.8 million primarily due to a 12.1% increase in educational services and facilities expense to $166.8 million coupled with an 8.0% increase in general and administrative expense to $226.7 million. However, the top-line growth more than offset the increase in operating expenses. Consequently, Career Education recorded an impressive 95.4% growth in operating income to $97.0 million from $49.6 million in the year-ago quarter.
The company ended the quarter with cash and cash equivalents of $284.5 million, compared to $242.9 million of cash in the year-ago period. During 2009, Career Education deployed $201.1 million towards share buyback and $74.1 million towards capital expenditure.
Career Education is a provider of private, for-profit post-secondary education with more than 75 campuses throughout the U.S. and Canada, France, Italy and the U.K. The company offers a variety of master’s degree, bachelor’s degree, associate degree, and diploma programs in career-oriented disciplines.
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