Kaplan Acquires J.Y. Monk - Analyst Blog

With a view to enhance its educational sphere, Kaplan Inc., the subsidiary of The Washington Post Company (WPO), recently acquired one of the leading real estate education provider, J.Y. Monk, based in North Carolina.

J.Y. Monk, which was founded in 1975, imparts pre and post licensing courses to brokers, exam oriented courses, and Broker-In-Charge Annual Review courses. The educational institute conducts classes in 36 locations reaching out to approximately 180,000 students.

J.Y. Monk, which will become a part of Kaplan Real Estate Education, will  help Kalpan become the largest provider of broker exam prep programs as well as real estate licensing and continuing education. Kaplan's professional education division also imparts education in the accounting, insurance, securities, financial planning and information technology industries.

Currently, an uncertainty related to a proposed regulation by the Department of Education is looming over the education sector as it may weigh upon student enrollments and the company's profits.

Recently, the Department of Education proposed that an educational program could qualify for Title IV funds, only if it helps in achieving gainful employment, which includes the criteria of loan repayment rate and debt-to-income ratios. The institutions are under the scanner due to the rise in the default rate of student loans, and are now being asked to submit information relating to recruitment procedures and the use of students' grant.

The for-profit education institute,Capella Education Company (CPLA) now expects enrollment to rise in the range of 16% to 17% in fourth-quarter 2010, reflecting slower growth compared with the previous quarters. The sector bellwether Apollo Group Inc. (APOL) also cautioned that enrollment in first-quarter 2011 would drop by more than 40%, and withdrew its outlook for the fiscal year, citing an uncertain regulatory environment.

Currently, we have a ‘Neutral' rating on The Washington Post Company.