For-profit stocks make a comeback following Trump victory
- Bloomberg reports on the resurgence of for-profit education companies and collections vendors in the days following Donald Trump's surprise election as US president.
- Navient and Sallie Mae, student loan repayment collection vendors, hit 52-week highs one day after the election results, a nod some experts say to Trump's strong talk on deregulation in the higher education industry.
- While few details have emerged about Trump's vision for student lending, many expect that the federal government will transition out of loan origination, and banks will be back in business.
The Obama administration's emphasis on for-profit institutions and practices considered predatory have put for-profits up against the ropes in recent years. Many anticipate a less regulated higher ed climate in a Trump administration, an expectation that has weighed favorably on the for-profit industry.
But a Trump adviser has said the president-elect believes institutions should have some "skin in the game" on student loan defaults, and his whopping student loan forgiveness proposal could mean the collective sigh of relief by the for-profit community is a bit premature. Schools could be left on the hook for student loan defaults, which would not bode well for the sector that was originally targeted because of high default rates.