Apollo Group's (Nasdaq:APOL) reported second quarter results on Monday that demonstrated it is still working to find its footing, following increased industry scrutiny from regulators. An uptick in enrollment was an encouraging sign, though it could still be some time until total company sales and profits start moving steadily forward again.

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Second Quarter Recap

Apollo's revenues fell 7.5% to $969.6 million. Management attributed the decline to lower University of Phoenix enrollment, though it was able to offset the 8% drop in U of P revenue with some tuition increases and related fee changes. Enrollment decreased 12.2% to 355,800 students. On a more positive note, new enrollment eked out 1% growth, improving from a period of market decline as Apollo has adjusted its recruiting practices in response to increased government regulation and criticism that for-profit recruiting had not necessarily taken the best interest of underlying students to heart.

Last year's goodwill impairment charge helped reported operating income jump to $106.3 million, following a loss of $23 million in last year's second quarter. Net income also returned to positive territory at $63.9 million, or 51 cents per diluted share.

SEE: Surprising Earnings Results

Outlook and Valuation
For the year, analysts expect sales to continue to struggle and fall about 10% to roughly $4.2 billion. They project earnings of around $3.36 for an annual decline of over 30%. Given the earnings expectations, Apollo currently trades at a forward P/E of about 12.

The Bottom Line
Apollo is still working to regain its footing and find its way back to sustainable sales and profit growth. One of its recent initiatives is to forge relationships with corporations and help drive education among their employees. It also put a greater emphasis on specific job training programs, such as in telecommunications network support. Rivals such as Devry (NYSE:DV) and ITT Educational Services (NYSE:ESI) have been relatively strong in these trade-based classes.

SEE: Competitive Advantage Counts

In terms of total revenue, Apollo is still larger than these two players combined. It is also much larger than other rivals, including Strayer (Nasdaq:STRA) and Capella Education (Nasdaq:CPLA). It remains the largest in the industry and its University of Phoenix name has high brand recognition. At some point, growth will likely return to the company, though there is likely no hurry to invest until visible signs of growth start to appear.

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At the time of writing, Ryan C. Fuhrmann did not own shares in any of the companies mentioned in this article.

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