Mr. Close: Since joining Jefferies this past October, I have initiated coverage on several names in the knowledge services industry group. Right now my initial coverage includes the post-secondary or higher education service providers, an area that I have covered for six years now. Going forward, I look to expand the coverage list into other companies that either provide products or services to the educational marketplace. Considering the length of time covering the postsecondary area, I've seen a lot of changes with respect to investor interest. Right now, I think there continue to be opportunities to invest in the postsecondary sector going forward into 2004, although I readily admit that the stocks have been one of the best performing groups since 2000.
TWST: So the postsecondary companies are still the ones that are
outperforming?
Mr. Close: Generally speaking, the postsecondary companies have been the
darlings for investors over the past three years as they've really
performed quite well from a financial standpoint. They continue to put
up better than expected financial results, and that's led to share price
appreciation throughout that time period. Overall, the fundamentals
continue to look good going forward into the upcoming year, and that
provides the opportunity for these names to reap additional price
appreciation for 2004. The demographics are providing a tailwind that
potentially could support consistent growth over the next five to 10
years.
Tickers included in this excerpt: APOL, CECO, COCO, DV, EDMC, ESI, SLM, UOPX
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