UPDATE 1-Education stocks fall on report of official’s comments

* Report says DOE official seeks more regulation

* S&P 1500 Education Services Sub-Industry index fall 5 pct

* Bellwether Apollo Group Inc fall 6 pct at $57.99
(Adds comment from the U.S. Department of Education; updates
share movement)

April 29 (BestGrowthStock) – Shares of U.S. for-profit education
providers fell after a website reported that a top Department
of Education official made negative comments about the sector
and encouraged the need for more regulation in the space.

The article on insidehighered.com, an online publication
covering the education sector, summarized a speech by DoE
Deputy Under Secretary Robert Shireman to state regulators
Wednesday. According to the website, he said the for-profit
education sector needed more regulation to ensure access and
quality education for people.

“We’ve had constructive discussions in recent months, and
look forward to continued thoughtful dialogue with the career
education community,” the U.S. DoE told Reuters in an emailed
statement.

The S&P 1500 Education Services Sub-Industry index
(.15GSPEDUS: ) fell 5 percent. Bellwether Apollo Group Inc
(APOL.O: ) was down about 6 percent at $57.99 Thursday afternoon
on Nasdaq.

“While we believe the author of the article was not present
to hear the speech, it is based on second-hand accounts from
some who presumably did attend,” BMO Capital Markets analyst
Jeffrey Silber said in a note to clients.

Last week, U.S. Education Secretary Arne Duncan said his
department planned to issue proposals aimed at ensuring that
vocational schools provide the training needed for students to
find gainful employment without racking up excessive debt.

Earlier comments by Shireman have mostly been congenial to
the sector, though he is viewed as one of the chief architects
of the proposed gainful employment regulations, and is known
for his work to limit student debt, Silber added.

Stock Market Report

(Reporting by Amulya Nagaraj in Bangalore; Editing by
Saumyadeb Chakrabarty, Don Sebastian)

UPDATE 1-Education stocks fall on report of official’s comments