Itaú BBA - Education: Unfavorable Short-Term Scenario Set to Slow Down the Sector

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Education: Unfavorable Short-Term Scenario Set to Slow Down the Sector

May 8, 2015

The private education sector is set to decelerate in the short-term. In the long run, the perspectives are positive.

• The private education sector, which expanded strongly in recent years, is set to decelerate. The main drivers behind recent growth (falling unemployment, more favorable demographics and expansion of government funding programs) will go through changes that will likely decelerate its pace.

• In the short term, providers of basic education will be affected by higher delinquency levels and migration of students to public schools. Private colleges and universities will be affected by higher unemployment as well as by the implications of rule changes in the government’s student loan program known as FIES.

• In the long run, as economic growth rebounds and the labor market stabilizes, both segments should again perform favorably.


 

Please open the attached pdf to read the full report.

  



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