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Six analysts and top management from twelve sector firms examine the education sector in this special 85-page Education Industry issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info465.htm.

TWST: Peter, just one word, if you would, about DeVry (NYSE:DV). You touched on the fact that you consider there to be some problems or difficulties that are specific to DeVry. Would you just tell us what those are?

Mr. Appert: DeVry has an extraordinary record of 10 consecutive years of 20% plus annual net income growth. I did a screen earlier this year looking at the number of companies that have been able to achieve that goal, and in fact, there are only a handful, four or five companies, that have been able to maintain that record. Unfortunately, it looks as if 2001, which is fiscal 2002 for DeVry, will be the year that breaks that good record for DeVry. The reason is that the enrollment growth rates in the fall period, which is the most important period of the year for most of these companies, were disappointing for DeVry. I think the disappointment is a function of several markets where they’ve had some operating challenges. Specifically, they have a new campus in Arlington, Virginia, located very close to the Pentagon, where the start of the fall season was timed, unfortunately, right in-line with the September 11th terrorist attack. As a result, the enrollment numbers there have come in low, versus expectations. They have a campus in Denver, which was acquired a couple of years ago, where they’ve been switching the curriculum for the programs that were offered at the time of the acquisitions to the programs that DeVry historically has offered. That transition has caused some disruption in the enrollment numbers there. Because DeVry has only 22 or 23 campuses, disappointments at a handful of campuses can have a disproportionately large impact on their overall results, and I think that’s what has happened here short term. DeVry is still an excellent company with a tremendous long-term growth record. I think that the management there will get it back on track. But it’s going to be challenging, from an earnings standpoint, on a short-term basis. That being the case, if I have an opportunity to own this stock at a discounted valuation because of the near-term earnings concerns, it will be more appealing. Basically, I would like to see the stock in the very low $20s. That would be an interesting entry point, I think, even recognizing the challenges they face near term. Currently, the stock is trading in the mid-$20s.

TWST: One last question — what are the two or three most frequently asked questions that you get from investors?

Mr. Appert: Typically, the questions tend to be quite company-specific and in response to whatever is happening in the market at the time. Currently, there’s a lot of interest and concern about the impact of the macro-environment on the education industry, specifically, for example, what do higher levels of state and local government deficits mean for educational funding, or how does the impact of a weaker economy on corporate training budgets translate into revenue growth opportunities for the various companies in this market? That seems to be a significant investor focus at the moment. A year ago, or a year and a half ago there was a great deal of attention being paid to the issue of who the next start-ups would be, where will the next venture-based companies come up, and how will that change the competitive dynamic in the industry? Of course, we hear less on that issue currently.

1) Education Industry - In an in-depth (11,600 words) Analyst Roundtable, Peter L. Martin, Senior Vice President at Jefferies & Company, Inc., Gerald R. Odening, Managing Director at J.P. Morgan H&Q and Jeffrey M. Silber, Senior Vice President at Gerard Klauer Mattison & Company, Inc. examine the outlook for the sector including enrollments in higher education, regulatory issues and share specific stock recommendations.

2) Educational Publishing & Service Companies - In an in-depth (4,700 words) Analyst Interview, Peter Appert, Managing Director at Deutsche Banc Alex. Brown, Inc., examines the outlook for the sector and shares specific stock recommendations.

3) Outlook for Education Stocks - In an in-depth (4,000 words) Analyst Interview, Greg W. Cappelli, Managing Director at Credit Suisse First Boston, examines the outlook for the sector and shares specific stock recommendations.

4) Knowledge Technologies - In an in-depth (4,700 words) Analyst Interview, George Sutton, Managing Director at RBC Capital Markets, examines the outlook for the sector and shares specific stock recommendations.

5) The TWST confidential Off-The-Record survey of management performance at eighteen sector firms asked market insiders about the ability of management teams to create shareholder value.

6) CEO interviews (average 2,500 words). Top management of twelve sector firms examine the outlook for their firm and the sector.