As part of our Education report we spoke with George Sakellaris of  GARP Research & Securities Co. and asked him about the regulatory issues facing the education industry

Mr. Sakellaris: “That’s the big question here. I think that’s some­thing that’s held some of the stocks in check over the past several months It’s certainly a topic that’s been batted around significantly in the investment community. It’s hard to say. Negotiated rule making ses­sions are coming up in the fall, and some new rules could emerge as early as Q1 of next year. My personal opinion is that it’s a lot of hype that may result in little change. I think the administration’s topline goal is to get more col­lege graduates. Given the capital intensity and other growth impedi­ments at traditional schools and the almost unlimited capacity potential and open enrollment policies of most for-profit educators, I think the administration will have a hard time reaching its goals with­out embracing not only community colleges, which is what they have done so far, but also some of the higher quality for-profit educators. “

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