NEW YORK (TheStreet) -- Apollo Education (APOL stock is gaining 22.26% to $7.80 in after-hours trading on Monday after Dow Jones Newswires reported that Apollo Global Management (APO) is considering acquiring the private education provider, according to MarketWatch.

Apollo Global Management is possibly in advance talks to acquire Apollo Education, which could be sold for about $1 billion, MarketWatch added.

Before the market open this morning, Phoenix-based Apollo Education announced its board of directors will explore strategic alternatives to improve its operations, including a potential sale of the company.

The parent company of the University of Phoenix said in a statement that any change would "support and accelerate Apollo's strategic initiatives."

Earlier today, Apollo Education also reported lower than expected financial results for the fiscal 2016 first quarter.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

We rate APOLLO EDUCATION GROUP INC as a Sell with a ratings score of D+. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Diversified Consumer Services industry and the overall market, APOLLO EDUCATION GROUP INC's return on equity is below that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $44.88 million or 48.35% when compared to the same quarter last year. Despite a decrease in cash flow of 48.35%, APOLLO EDUCATION GROUP INC is in line with the industry average cash flow growth rate of -55.97%.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 78.98%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 131.03% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • APOLLO EDUCATION GROUP INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, APOLLO EDUCATION GROUP INC reported lower earnings of $0.49 versus $1.92 in the prior year. This year, the market expects an improvement in earnings ($0.59 versus $0.49).
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Diversified Consumer Services industry average, but is less than that of the S&P 500. The net income has significantly decreased by 162.1% when compared to the same quarter one year ago, falling from $29.78 million to -$18.48 million.
  • You can view the full analysis from the report here: APOL