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Essay / Research Paper Abstract
In this 3 page paper, the writer focuses on what has been happening to stock shares of for profit education companies. They have been steadily declining. The writer comments about relationships between company and stock analysts in terms of the need for honesty. Bibliography lists 5 sources.
Page Count:
3 pages (~225 words per page)
File: MM12_PGprfedst.rtf
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Unformatted sample text from the term paper:
a working relationship with the company that will handle the myriad of legal requirements as well as the offering of shares. The one thing this CEO must know is that
stock analysts can not be bought or bribed. A good relationship with numerous analysts will have very little effect on how the stock is rated in the market. Given
the major scandals during the last several years, it should be crystal clear to all company CEOs that the best way to develop and maintain relationships in this community is
to be honest about the companys dealings. Any shadiness at all will result immediately in the companys stock being downgraded. Even good numbers will not always result in a high
rating for a stock. For example, DeVry reported its 2006 earnings had skyrocketed" (Smith, 2006) but DeVrys share prices plummeted 11 percent (Smith, 2006). The reasons for the dismal stock
performance are many and complex. It generated 46 percent more free cash flow in 2006 than in 2005 and it realized 52 percent more net income but it did this
by dramatically cutting back on its capital expenditures (Smith, 2006). In 2005, DeVry "spent $42.9 million on improving and building out its infrastructure" (Smith, 2006) but they spent only $25.3
million in 2006 (Smith, 2006). As a side-note, DeVry offers programs in technology and business; enrollment began declining after the 2001 technology bubble burst (Associated Press, 2006). So, whats the
problem with DeVry? Smith suggests "these successes may have persuaded DeVry to keep going alone instead of competing head-to-head with rivals such as ITT (NYSE: ESI - News), Career Education
(Nasdaq: CECO - News), and Corinthian (Nasdaq: COCO - News)" (Smith, 2006). In other words, shareholders do not see any type of great profit in the near future and thus,
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