For Profit Education Collapse

August 16, 2010

Today is the day the shorts won and the floor fell out from under the sector.  Government scrutiny and fraud allegations are now plaguing the sector and almost certain to hammer results at a number of the for profit firms.  Stock prices for the entire industry have been getting hit hard the last few months but today prices are getting hammered (with the exceptions of Apollo).

ANT hat tip to Steve Eisman for alerting the world to this trade (both because it is making people money and because it is going to result in a corrupt and at best, amoral, industry being brought into line with reality.

The 1 day chart for the industry is horific, with some players down 20%.

The 3 month chart (roughly when Eisman started promoting the trade, is not much better):

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