Piper Jaffray Neutral On Apollo Group, Inc. (APOL)

Piper Jaffray has a Neutral rating and a $43 price target on shares of Apollo Group, Inc. APOL. In a note sent to clients, Piper Jaffray writes, "We expect Apollo's F1Q results to be largely a repeat of the prior quarter: in line but decelerating revenues accompanied by a sharp decline in new student starts. With its proactive initiatives to improve student outcomes and right-size costs, we believe Apollo could be an interesting second half 2011 story. For now, we prefer to stay on the sidelines." Piper Jaffray goes on to say, "We do not expect to see revenue and earnings comparisons turn positive until the second half of F2012. While a less threatening regulatory environment would serve as a positive catalyst for the postsecondary group overall, we believe APOL's shares may be stuck in a trading range until we get closer to a rebound in earnings growth. Accordingly, we would recommend investors revisit the shares in 2H F2011. We continue to view the long-term prospects of Apollo as attractive given its scale and proactive steps taken to enhance graduation rates and improve regulatory compliance." Shares of APOL gained $1.11 yesterday to close at $39.49.