This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Career Education Corp Valuation Analysis: Update

Stocks in this article: CECO

One of my favorite value-turnaround plays, Career Education Corp. (CECO) recently reported full-year and fourth quarter 2013 results that beat Wall Street expectations. However, aside from beating Street expectations, these results showed that Career’s management is making solid progress in bringing the company back to health, underlining the company’s recovery potential.

Career Education

I first picked up Career Education Corp. (CECO)’s turnaround story in October of last year, when the company’s shares were trading at around $3.10. Since then, Career has announced a game changing deal to sell its European operations for what was at the time, more than the entire market capitalization of the company. This deal has been followed by this impressive looking set of fourth quarter results and improving outlook. All in all, since my initial recommendation back in October, the stock has surged 137% to $7.35, although this is just below the 52-week high of $7.81.

Career Education’s impressive results

For the fiscal fourth quarter of 2013, Career Education Corp. (CECO) reported revenues of $247.1 million and a net loss of $30.6 million, or -$0.46 per diluted share, a significant improvement on 2012′s fourth quarter result; a net loss of $61.5 million, or -$0.93 per diluted share on revenues of $303.3 million. For the full year 2013, the company reported total revenue of $1.06 billion, a net loss of $164.3 million, or -$2.46 per diluted share. Unfortunately, this was worse than the net loss of $142.8 million, or -$2.15 per diluted share, reported for the full year 2012 on revenue of $1.34 billion.

Nevertheless, the company is making important progress in other areas. For example, operating costs continue to decline dropping by $59.0 million in the fourth quarter and by more than $200.0 million for the full year. Additionally, net cash used in operating activities was only $8.0 million during the fourth quarter, versus $10.9 million in the third quarter and $52.8 million in the second quarter — so the company’s cash burn has slowed, giving it more time to restructure and return to profit.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs