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Where Do Post-Secondary Education Stocks Go from Here?

MINNEAPOLIS, Sept. 30 /PRNewswire-FirstCall/ -- U.S. Bancorp Piper Jaffray Senior Learning Services Research Analyst Mark Marostica recently released a new report entitled: The Valuation Conundrum, Volume II, which is an update to his initial report, The Valuation Conundrum: A Guide To Understanding Postsecondary Education Company Valuation, released in January 2002.  The new report outlines the differences between the publicly-traded post-secondary education companies and how to properly rank them in terms of investment quality and valuation.  In addition, Marostica maps out valuation differences among the public post-secondary education companies, offers a historical valuation analysis and discusses thoughts on future valuation trends for the group.

Marostica analyzed the following companies in the post-secondary education group: Apollo Group, Inc. (APOL, Strong Buy, $43.63, #), Career Education Corporation (CECO, Strong Buy, $46.74, #>), Corinthian Colleges, Inc. (COCO, Strong Buy, $36.85, #>), DeVry (DV, not rated, $18.35), Education Management Corporation (EDMC, Outperform, $43.438, #>), ITT Education (ESI, not rated, $18.35), Strayer Education (STRA, not rated, $58) and Sylvan Learning Systems, Inc. (SLVN, Outperform, $13.21, #>).

We ultimately believe investors will continue to value the strong business fundamentals of post-secondary education companies, which include a high level of revenue and earnings visibility, together with highly profitable and predictable business models and a favorable post secondary education macro environment.

About the Valuation Conundrum, Volume II Report

The cornerstone of Marostica's valuation analysis is his proprietary attribute analysis and scoring methodology, which is used to first assign scores to the various attributes of each post-secondary education company. After assigning individual attribute scores for each company, he then developed a composite attribute score for each company, with a higher composite attribute score being more favorable. The next step in Marostica's valuation analysis was to compare the composite attribute score of each company with its current P/E-to-growth (PEG) ratio.

Marostica concluded the following from his analysis:

1)  There is a strong correlation between a post-secondary education

company's composite attribute score and its PEG ratio -- companies

with higher attribute scores generally trade at higher PEG ratios.

According to Marostica's analysis, "Sixty one percent of the variation

in the PEG ratio is explained by the composite attribute scores."

2)  This analysis will help investors identify and explain "valuation

disconnects" -- instances in which a company's attribute score is not

aligned with its PEG ratio.

3)  This analysis will be useful in assessing the impact of an attribute

change on company valuation.

To request a copy of the report, please contact Susan Beatty, 612-303-5680 or susan.beatty@pjc.com .

U.S. Bancorp Piper Jaffray, a subsidiary of Minneapolis-based

U.S. Bancorp (NYSE: USB), is a focused securities firm comprised of three divisions: Equity Capital Markets, Fixed Income Capital Markets and Private Advisory Services. The firm provides a full range of investment products and services to individuals, institutions and businesses. The firm has over 120 offices in 23 states across the country. The Equity Capital Markets Division focuses on the needs of growth companies in the health care, technology, financial institutions, consumer and communications growth sectors. The firm has a national reputation for its expertise in fundamental research and equity and debt financing. The Fixed Income Capital Markets business provides bond issuers, individual investors and institutional investors expertise in investment banking, underwriting, trading, sales and research. The firm offers innovative solutions in corporate and government debt financings with particular expertise in corporate, health care/hospitals, real estate, higher education and government debt. The Private Advisory Services division financial advisors provide guidance in retirement planning, education planning, estate planning and wealth accumulation. Investors select from a wide array of products, including fee-based products, stocks, bonds, mutual funds, annuities, insurance and trust services.  U.S. Bancorp offers a comprehensive range of financial solutions through U.S. Bank, U.S. Bancorp Asset Management, U.S. Bancorp Investments and U.S. Bancorp Piper Jaffray. For more information on U.S. Bancorp Piper Jaffray, visit www.piperjaffray.com .

Rating Definitions

Investment Opinion: Investment opinions are based on each stock's return potential relative to the overall market*, not on an absolute return.

-- Strong Buy: Expected to outperform the relevant broader market index

over the next 6 to 12 months. An identifiable catalyst is present to

drive appreciation.

-- Outperform: Expected to outperform the relevant broader market index

over the next 12 to 18 months.

-- Market Perform: Expected to perform in line with the relevant broader

market index over the next 6 to 12 months.

-- Underperform: Expected to underperform the relevant broader market

index over the next 6 to 12 months.

* Broader market indices = Russell 2000 and S&P 500

Volatility Rating: Our focus on growth companies implies that the stocks we recommend are typically more volatile than the overall stock market. We are not recommending the suitability of a particular stock for an individual investor. Rather, it identifies the volatility of a particular stock.

-- Low: The stock price has moved up or down by more than 10% in a month

in fewer than 8 of the past 24 months.

-- Medium: The stock price has moved up or down by more than 20% in a

month in fewer than 8 of the past 24 months.

-- High: The stock price has moved up or down by more than 20% in a month

in at least 8 of the past 24 months. All IPO stocks automatically get

this volatility rating for the first 12 months of trading.

The following disclosures apply to stocks mentioned in this report if and as indicated: (#) U.S. Bancorp Piper Jaffray (USBPJ) makes a market in the Company's securities or may buy and sell the Company's securities on a principal basis. (ˆ) A USBPJ analyst who follows this Company or a member of the analyst's household has a beneficial interest (a long equity position) in the Company's securities. (@) Within the past12 months, USBPJ was a managing underwriter of an offering of, or dealer manager of a tender offer for, the Company's securities or the securities of an affiliate. (>) USBPJ has either received compensation for investment banking services from the Company within the past 12 months or expects to receive or intends to seek compensation within the next three months for investment banking services. (˜) A USBPJ analyst who follows this Company, a member of the analyst's household, a USBPJ officer, director, or other USBPJ employee is a director and/or officer of the Company.

Nondeposit investment products are not insured by the FDIC, are not deposits or other obligations of or guaranteed by U.S. Bank National Association or its affiliates, and involve investment risks, including possible loss of the principal amount invested.

USBPJ research analysts receive compensation that is, in part, based on revenues of USBPJ Equity Capital Markets that also include investment banking revenues. USBPJ research analysts who follow this Company report to the Head of Equity Research who, in turn, reports only to the President of Equity Capital Markets.

This material is based on data obtained from sources we deem to be reliable; it is not guaranteed as to accuracy and does not purport to be complete. This information is not intended to be used as the primary basis of investment decisions. Because of individual client requirements, it should not be construed as advice designed to meet the particular investment needs of any investor. It is not a representation by us or an offer or the solicitation of an offer to sell or buy any security. Further, a security described in this release may not be eligible for solicitation in the states in which the client resides. U.S. Bancorp and its affiliated companies, and their respective officers or employees, or members of their families, may have a beneficial interest in the Company's securities and may purchase or sell such positions in the open market or otherwise. This report is a communication made in the United Kingdom by U.S. Bancorp Piper Jaffray to market counterparties or intermediate customers and is exclusively directed at such persons; it is not directed at private customers and any investment or services to which the communication may relate will not be available to private customers. In the United Kingdom, no persons other than a market counterparty or an intermediate customer should read or rely on any of the information in this communication. Securities products and services offered through U.S. Bancorp Piper Jaffray, member SIPC and NYSE, Inc., a subsidiary of U.S. Bancorp.   Gotoanalysts.com

Additional information is available upon request.

U.S. Bancorp Piper Jaffray Inc. is a member of the National Association of Securities Dealers, CRD number 665.



SOURCE  U.S. Bancorp Piper Jaffray

    -0-                             09/30/2002

/CONTACT:  Susan Beatty, Public Relations of U.S. Bancorp Piper Jaffray, +1-612-303-5680/

/Web site:  http://www.piperjaffray.com  /


CO:  U.S. Bancorp Piper Jaffray; U.S. Bancorp; Apollo Group, Inc.; Career

Education Corporation; Corinthian Colleges, Inc.; DeVry; Education

Management Corporation; ITT Education; Strayer Education; Sylvan Learning

Systems, Inc.

ST:  Minnesota

-- MNM015 --
2447 09/30/2002 10:22 EDT http://www.prnewswire.com

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding U.S. Bancorp's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.

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