Structural Change Without Legacy Customers Has (LOPE) Falling off a Cliff
For Immediate Release 09/09/2019
Citron Research has successfully analyzed for-profit education over the past 10 years despite being contrary to Wall St consensus, namely Citron correctly predicted the 90% crash in the stock price of then Wall Street darling Apollo Group. More recently, Citron was ahead of the curve in our analysis of TWOU which is currently trading down 85% from its high and 60% from our coverage.
Introducing Grand Canyon Education
Citron believes that management of Grand Canyon has been both incompetent and deceitful in its ability to transform the school to adapt to the rapidly changing for profit education space. LOPE management spent many years focused on building a local Arizona campus that offers an “affordable Christian education” along with continuing a legacy online school.
However, last year Grand Canyon University became Grand Canyon Education with a promise of transforming the business model….and that is where it stopped.
Management has failed to deliver on any of the promises of innovation to Wall Street and it has finally caught up to them
Last month, online education powerhouse TWOU discussed the surprisingly rapid adoption and mainstreaming of online education from which there is no escape, and which will send LOPE stock down 70% in the next 18 months.
The reason the share price is continue to fall is once the business turns, and it probably has, LOPE does not have a durable revenue base to depend on . Even their happiest of customers leave them every 2.5 years.