In a report published today, Wells Fargo upgraded shares of Apollo Education Group (APOL) to Outperform from Market Perform and increased the valuation range to $43-46 from $36-39.

“We believe new student starts have reached a meaningful inflection point and together with continued impressive cost management, we believe the company has achieved positive momentum in its turnaround. Nervousness regarding RPS weakness, somewhat tepid H2 guidance, and a new OIG investigation, (none of which we view as a serious cause for concern,) may provide the short-term price retrenchment to create an attractive entry point for new investments” Wells Fargo said

“Weaker-than-anticipated RPS leads us to lower our estimates slightly. Our FY2014E EPS moves to $2.24 from $2.34, (though still at the high end of management’s guidance range,) and our FY2015E EPS moves to $1.93 from $2.16. We are raising our valuation range to $43-46 (from $36-39) as we discount back an expected operating margin of 22-24% by 2018.” it added

Shares of Apollo Education Group (APOL) closed at $35.16 on Tuesday

For More Analyst Ratings Click Here