We added to our Devry (DV) position as the stock declined approximately 27% in the third quarter. We maintained our roughly 1.80% position in the stock, despite the material decline in the share price. Many of the schools in the For-Profit education industry have experienced negative enrollment growth recently mainly because potential students have concerns about the job market and their employment prospects after graduation. We believe these are cyclical issues and enrollment will likely stabilize, albeit at a lower level, in 2013. The company continues to experience growth in its medical and nursing schools and is diligently adding to its Brazilian assets. DV’s balance sheet remains strong with nearly $3 in net cash, and the valuation is attractive at less than 4x enterprise value to EBITDA.
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