UPDATE: BMO Capital Markets Reiterates Outperform Rating, Lowers PT on American Public Education

In a report published Friday, BMO Capital Markets reiterated its Outperform rating on American Public Education

, but lowered its price target from $41.00 to $37.00. BMO Capital noted, “While the impact of stipend chasers has created a lot of fog around enrollment trends, we believe investors should focus on results excluding this impact (i.e., expected 4Q12 new course enrollments up 8%-9% y/y excluding stipend chasers as opposed to official guidance of down 3%-7%). Additionally, we believe strong total net course enrollments underscore the positive retention trends APEI is experiencing among its legitimate students (non-stipend chasers). While revenue guidance for 4Q12 came in below consensus, we believe the company could experience several positive margin tailwinds in the quarter and in 2013, stemming from the new $50 per-course tech fee, increased rollout of digital texts, and lower bad debt expense.” American Public Education closed on Thursday at $32.94.