Cogna (COGN3), Ser Educacional (SEER3) and Yduqs (YDUQ3) soar after Lula’s speeches about FIES and regulatory change

Cogna (COGN3), Ser Educacional (SEER3) and Yduqs (YDUQ3) soar after Lula’s speeches about FIES and regulatory change
Cogna (COGN3), Ser Educacional (SEER3) and Yduqs (YDUQ3) soar after Lula’s speeches about FIES and regulatory change

The shares of companies in the education sector recorded strong increases in the early afternoon of this Monday (19), reflecting news of regulatory changes for some courses, in addition to statements by former president Luiz Inácio Lula da Silva, currently leader of the opinion, about educational funding programs.

According to Lula, programs aimed at higher education, such as the Higher Education Student Financing Fund (Fies) and the University for All Program (Prouni), “will come back with force” in the event of his victory.

At around 2:00 pm, Cogna’s common stock ([COGN3]) rose 8.59%, those of Yduqs (YDUQ3), 13.45%, and those of Ser Educacional (SEER3), 9.51%. Cruzeiro do Sul (CSED3) and Ânima (ANIM3), in turn, advanced 7.86% and 13.89%.

“It may (or may not) be relevant depending on the relevance (scale of funding programs) and the rules of the game (who gets the money), but it could be a catalyst for an industry that has been under a lot of pressure recently,” comments the analyst. Javier Martinez de Olcoz Cerdan of Morgan Stanley in a report.

The analyst, however, also pointed out that the sector’s actions have benefited from the news that the Ministry of Education (MEC) will stop authorizing new distance courses for undergraduate courses in Law, Psychology, Dentistry and Nursing.

“The regulator had been analyzing and approving applications for over a year and many universities were just waiting for the final authorization to start enrolling students”, he explains.

“The decision was taken after complaints from the OAB, which for many years tried to stop this process, questioning the concern with the quality of these distance learning law courses and the approval criteria of the MEC”.

According to the specialist, the news brings relief to companies that work physically, because the continuation of distance learning courses would make the campuses economically unfeasible – this in courses that are profitable, being Law one of the most relevant in the companies’ revenue.

“In our opinion, Brazil’s education sector is cheap and the listed players are in a better position to gain market share relative to regional schools, but the recovery process is slow and should take two to three years to materialize. ”, comments Cerdan.

“That said, we believe that there are some possible catalysts to keep in mind: post-election, we can see new alternatives for public funding, especially if Lula wins; if macro conditions improve, the players listed can accelerate inorganic expansion”, he concludes.

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The article is in Portuguese

Tags: Cogna COGN3 Ser Educacional SEER3 Yduqs YDUQ3 soar Lulas speeches FIES regulatory change

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