An A+ for education stocks
Faced with the tough job market, many unemployed workers are heading back to school, said Yuval Rosenberg in Fortune. That’s good news for publicly traded education companies such as Apollo Group, DeVry, and ITT Educational Services. While the S&P 500 fell 38 percent in 2008, shares for these companies gained some 10 percent. The companies are still posting solid earnings: In January, for example, Apollo reported a 29 percent increase in fiscal first-quarter earnings. DeVry has moved up to the “dean’s list” thanks to “a turnaround initiated several years ago,” which expanded its offerings to include degrees in health care and education as well as technology. And the sector “got a boost” upon reports that Congress is looking to increase limits for federal loans, which are a “major source” for tuition payments at such schools.
Wanted: Stock research
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Layoffs on Wall Street have created a “shortfall” in quality equity research for individual investors, said Aaron Pressman in BusinessWeek. The number of senior analysts has been cut in half, according to Integrity Research Associates. Most of the best analysts are heading to work for hedge funds or boutique research firms that don’t cater to individuals. But one boutique firm, Research Edge, is planning to make its buy and sell recommendations available to individuals—for a $2,700 annual fee. Can’t afford to pay that much for research? Some “long-running free financial blogs,” such as Footnoted.org and Bespoke Investment Group, are rolling out premium services for considerably less ($1,000 a year for Footnoted.org; $365 a year for Bespoke Investment Group). Morningstar.com is also a great research tool. This “granddaddy of premium websites” charges $159 a year for its premium service, which includes reports from 200 analysts covering some 2,000 stocks, as well as top-notch screening tools for doing research on your own.
Real deals on housing
Average home prices have fallen some 20 percent, and mortgage rates are as low as they’ve been in decades, said AnnaMaria Andriotis in SmartMoney. But, “given the glut of homes on the market,” prospective home buyers might as well try to score an even better deal. For the best deals on a mortgage, plan to get at least three bids from lenders. Right now “house hunters need to have a credit score of at least 660 to 680 and be prepared to make a down payment of 20 percent or more.” When you’ve found a house you’re interested in, size up the current homeowners to judge how willing they’ll be to negotiate. “Prospective home buyers shouldn’t be afraid to low-ball an offer or, for that matter, negotiate other perks such as having the seller pay for closing costs or requesting the washer and dryer come with the home.”
