Barrington Upgrades DeVry On Positive Expectations For Management Execution

The brokerage, which set a price target of $30, sees a potential opportunity for DeVry from the abrupt closing of more than 130 ITT Technical Institutes (ITT Educational Services, Inc. ESI) nationwide. In addition, it also cuts competition for DeVry's technology programs.

"If DVU were to enroll ITT transfer students (more than it usually does), it would be good for DVU enrollment (and overcapacity issues) but, perhaps more importantly, a lifeline to former ITT students in a difficult position and, in our opinion, be well regarded by DVU's regulators," analyst Alexander Paris wrote in a note.

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The analyst said Lisa Wardell, who took the helm at DeVry on May 24, plans to stabilize revenue and ultimately grow enrollment via new program offerings, focusing on specific programs, new pricing and cost controls.

"Catalysts include potential value-unlocking divestitures (no decisions have yet been made) and a settlement of open regulatory issues, perhaps sooner rather than later," Paris noted.

For the full year, the company's guidance calls for revenue to be flat (suggesting revenue of about $1.844 billion) and adjusted EPS to grow in the mid-single-digit ranges suggesting EPS of approximately $2.53. The current FactSet consensus calls for FY/17 revenue of $1.852 million and diluted EPS of $2.51.

Shares of DeVry closed Tuesday's regular trading at $22.56. At time of writing Wednesday, the stock was up 2 percent at $23.

Full ratings data available on Benzinga Pro.