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January 4, 2013
16:39 EDTESIITT Educational reports $13.2M after-tax charge in Q4, will cut EPS by 56c
On December 28, ITT Educational entered into a settlement agreement and release with Sallie Mae to settle the previously disclosed litigation matter between the company and Sallie Mae relating to the risk sharing loan program agreement, dated as of July 17, 2007, between the company and Sallie Mae. Under the terms of the settlement agreement, the company has agreed to pay a one-time payment of $46M to Sallie Mae on or before January 29, 2013. The company expects to record an after-tax charge to net income of approximately $13.2M in Q4. The company also expects that this after-tax charge to net income will reduce its EPS by approximately 56c in Q4.
News For ESI From The Last 14 Days
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January 27, 2016
12:28 EDTESIFor-profit education names fall after FTC sues DeVry over marketing
DeVry Education (DV) and its peers in the for-profit education space are falling after the Federal Trade Commission filed suit against the company, alleging that DeVry's advertisements "deceived" consumers about the likelihood of finding jobs in their chosen fields of study and earning more than graduates from other universities. In a related action, the Department of Education is also moving against the company for those same practices, requiring it to stop the allegedly deceptive advertisements and take steps to ensure it can verify the truthfulness of its post-graduation employment outcomes, including hiring an independent auditor and informing students of its "unsubstantiated" statistics. The Department's action comes after its investigation of DeVry found the postgraduation employment claims "have not been substantiated to the extent required by law." PRICE ACTION: Shares of DeVry crashed 13.5% to $20.54 following the news, while Apollo Education (APOL), ITT Educational (ESI) and Strayer Education (STRA) each slid over 2% and Bridgepoint (BPI) fell 1%.

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