RealMoney

After President Obama signed the �Student Aid Bill of Rights,� which proposes the right to discharge student debt into bankruptcy, BMO Capital says that such a change would imply financial risk to student lenders such as Sallie Mae (SLM). However, the firm does not expect the proposal to become law. It does not expects its estimates for Sallie Mae or education loan provider Navient (NAVI) to change, and keeps Market Perform ratings on both stocks. Publicly traded for-profit education companies include American Public Education (APEI), Apollo Education (APOL), Bridgepoint Education (BPI), Career Education (CECO), Corinthian Colleges (COCO), DeVry (DV), Grand Canyon (LOPE), ITT Educational (ESI) and Strayer (STRA).

TD Cowen analyst Moshe Orenbuch lowered the firm's price target on Navient to $13 from $14 and keeps a Sell rating on the shares. The firm rreducred its estimates and price target following Q1 earnings.

Truist raised the firm's price target on Strategic Education to $145 from $125 and keeps a Buy rating on the shares. The company reported a strong Q1, led by enrollment outperformance in both the U.S. Higher Education segment and the Australia/New Zealand segment, the analyst tells investors in a research note. Strategic Education is clearly tracking well ahead of the enrollment and margin tempo assumed in consensus FY24 estimates, the firm added.

Consumer Finance Analyst Shane holds a conference call with Head of Investor Relations Earyes to discuss earnings on April 25 at 1 pm. Webcast Link

Barclays analyst Terry Ma lowered the firm's price target on Navient to $11 from $13 and keeps an Underweight rating on the shares. The company's Q1 results missed estimates and the earning guidance was lowered as net interest margin continues to face additional headwinds, the analyst tells investors in a research note. The firm thinks Navient's issues and the execution risk around the cost reduction plans will continue to weigh on the shares going forward.

Reports Q1 NII $387M vs. $405M last year. Reports Q1 net interest margin 5.49% vs. 5.70% last year.

Keefe Bruyette analyst Sanjay Sakhrani lowered the firm's price target on Navient to $17 from $19 and keeps a Market Perform rating on the shares. Following the company's Q1 report, the firm is lowering its 2024 and 2025 EPS estimates, largely to reflect the impact of elevated prepayment rates on FFELP net interest margin.

"We have made substantial progress on the three strategic actions launched earlier this year to outsource student loan servicing, explore strategic options for our business processing division, and streamline our shared service infrastructure and corporate footprint," said David Yowan, president and CEO, Navient. "We are nearing completion of a final outsourcing agreement - which will pave the way for the transition of nearly 900 employees to support seamless service for our customers. Further, we expect to be in a position to decide on the options to divest our business processing division. We are beginning to execute our plans for a leaner company. When completed, we believe these actions will simplify our business, reduce our expense base, and increase our financial and operating flexibility."