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Since the early 1970s, the Apollo Group (NASDAQ: APOL) has transformed the private education business. The company not only has a broad network of campuses called the University of Phoenix, but also a thriving online education system.
As seen with yesterday's fiscal Q1 results, Apollo is continuing to grow at a nice clip. Net income increased 23% to $139.9 million, or $0.83 per share. Revenues were up 17% to $780.7 million.
Apollo got a boost from enrollments, which increased 11% to 325,000. But the company has also made important strides with student retention as well as the quality of the curriculum.
True, there are worries about the credit crunch. Just take a look at school loan provider Sallie Mae (NYSE: SLM), which plans to pull back somewhat. Yet, Apollo has anticipated some of this and has tried to reduce its reliance on private student lending.
In terms of expansion, Apollo recently struck a $1 billion joint venture with the Carlyle Group. The goal is to make investments in educational organizations outside the US. In other words, it's a good bet we'll see some deals in 2008.
All in all, it was a solid quarter. And in today's trading, Apollo's stock is up 12.77% to $76.81.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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