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Forum - DD DEN of Picks (Bridgepoint Education - BPI)    Comprehensive, well researched, Quality DD for buy and holds

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From: jjkool_01 (Rep: 1211) reply to NewTraderLearnDate: 08/12/2012 14:27
Forum: DD DEN of Picks - Msg #754 - List BPI msgs Thread #673433270 (Rec: 0)
For-Profit Colleges Only a Con Man Could Love
http://www.dallasobserver.com/2012-08-02/news/for-profit-colleges-only-a-con-man-could-love/.

http://www.dallasobserver.com/2012-08-09/news/barbarians-in-the-ivory-tower/
Barbarians in the Ivory Tower
America's for-profit colleges offer education only a con man (or a congressman) could love.



Reply to NewTraderLearn - Msg #751 - 07/26/2012 13:37

BPI Full DD & Analysis. First off what brought my attention to this stock was the massive sell off with the stock going from

over 22$ a share down to 8.22$ a share where its currently trading at all time lows there for i am going to take time to sit

down and tear this company apart from top to bottom i am going to be using there SEC Filings News Charts all public data that

can be found on this company that is currently avaible to the public.

First off the Chart is Extremely oversold no matter what metric you use that is screaming buy at these levels Chart below The

Sellers are clearly getting Killed here and locking in massive losses... Clearly the Sellers down here should be the ones

scared to death not the buyers



Lets go ahead and pull up the companies latest SEC 10Q Filing and lets dig through it

Market Cap: 436.73M 436 Million
P/E (ttm): 3.10 3 PE Dont get much lower then this...
EPS (ttm): 2.69 Huge Earnings

Bridgepoint Education, Inc.
13500 Evening Creek Drive North
Suite 600
San Diego, CA 92128
United States - Map
Phone: 858-668-2586 Done called the company left a message for them to call me back with the IR Dept
Fax: 858-408-2903
Website: http://www.bridgepointeducation.com

Details
Index Membership: N/A
Sector: Services
Industry: Education & Training Services
Full Time Employees: 8,900 Nearly 9000 Employees this is a Huge Company

Business Summary
Bridgepoint Education, Inc. provides postsecondary education services. It offers associate’s, bachelor’s, master’s, and

doctoral programs in the disciplines of business, education, psychology, social sciences, and health sciences. The company

offers its programs at campuses of its Ashford University located in Clinton, Iowa; and University of the Rockies located in

Colorado Springs, Colorado, as well as through online. As of December 31, 2011, it provided approximately 1,430 courses, 85

degree programs, and 140 specializations; and had 86,642 total enrolled students. The company was formerly known as

TeleUniversity, Inc. and changed its name to Bridgepoint Education, Inc. in February 2004. Bridgepoint Education, Inc. was

founded in 1999 and is headquartered in San Diego, California.

Key Statistics


Company Websites
Home Page
Search Yahoo! for:
More on Bridgepoint Education, Inc.

They are in Education have nearly 90,000 Students lets continue

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=8581219-835-105414&type=sect&dcn=0001305323-12-000028

Latest 10Q Filing

The total number of shares of common stock outstanding as of April 26, 2012 , w as 52,419,245 of those 52 Million the Float

is around 17 Million Shares so pretty small float here

Lets start off with the Income Statement

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
BRIDGEPOINT EDUCATION, INC.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except par value)

As of
March 31, 2012

As of
December 31, 2011
ASSETS



Current assets:



Cash and cash equivalents
$
162,148 162 Million in Cash this is increasing its up over 29 Million Dollars from last year...


$
133,921

Restricted cash
25 25k in restricted in cash


25

Investments
164,562 164 Million in Investments... so beetween the Cash and Investments along Thats 326 Million Dollars+ Right there... VS

a 436 Million Market Cap Keep in mind the company grew its Cash by over 29 Million Dollars in a year this also grew by 11

Million Dollars as well Thats 40 Million Dollars in growth on the balance sheet side in a year Wow


153,779

Accounts receivable, net
92,853 92 Million in AR This also grew Kinda of a High number would like to see this come down but education i am guessing

that this is debt that students owe... Student Debt is the one thing that cant be wiped out in bankruptcy so that is a plus

it has to be repaid back...


62,156

Deferred income taxes
5,441


5,429

Prepaid expenses and other current assets
17,864


17,199

Total current assets
442,893 442 Million in total assets thats alot thats actually more then our current market cap...


372,509

Property and equipment, net
92,082 92 Million in property this is up a tad


89,667

Investments
115,431 another 115 MIllion here


119,507

Student loans receivable, net
12,065 12 MIllion thats not really that much given the size of the balance sheet


9,255

Goodwill and intangibles, net
8,378 Pretty low here thats good because i usually subtract this number out anyways


7,037

Deferred income taxes
10,805


11,200

Other long-term assets
2,517


4,461

Total assets
$
684,171 The total assets of the company is nearly 200 Million Dollars more then where the current market cap of the company

is sitting at right now... and these grew by over 71 Million Dollars yoy WOW


$
613,636

LIABILITIES AND STOCKHOLDERS' EQUITY



Current liabilities:



Accounts payable
$
4,651 Very low actually down yoy


$
8,961

Accrued liabilities
67,409 increased but very managable


40,205

Deferred revenue and student deposits
189,169 This is just money they have recieved but they havent provided the services for yet


185,446

Total current liabilities
261,229 261 Million not to bad vs the assets of the company


234,612

Rent liability
19,741


16,595

Other long-term liabilities
8,980


8,781

Total liabilities
289,950 really low vs the asset side that is nearly 700 Million so love this balance sheet no long term debt lots of cash and

liquidity here and earnings cash flow positive as well


259,988

Commitments and contingencies (see Note 10)



Stockholders' equity:



Preferred stock, $0.01 par value:



20,000 shares authorized; zero shares issued and outstanding at March 31, 2012, and December 31, 2011





Common stock, $0.01 par value:



300,000 shares authorized; 59,526 issued and 52,276 outstanding at March 31, 2012; 58,981 issued and 51,731 outstanding at

December 31, 2011
595


590

Additional paid-in capital
144,340


137,447

Retained earnings
384,218 Wow huge earnings and they keep them these guys have been in business for a while


351,177

Accumulated other comprehensive gain (loss)
39


(595
)
Treasury stock, 7,250 shares at cost at both March 31, 2012, and December 31, 2011
(134,971
)

(134,971
)
Total stockholders' equity
394,221 394 Million thats about where the company is trading right now so i feel really comfortable buying the stock here


353,648

Total liabilities and stockholders' equity
$
684,171


$
613,636

The accompanying notes are an integral part of these condensed consolidated financial statements.


3

Very Solid balance sheet here no worrys at all with it

Lets go on to the income statement


BRIDGEPOINT EDUCATION, INC.
Condensed Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)


Three Months Ended
March 31,

2012

2011
Revenue
$
250,437 Revenues growth by nearly 20 Million YOY The price to sales ratio here has to be tiny as well plus we get growth for

a company trading near book value Wow


$
229,432

Costs and expenses:



Instructional costs and services
68,475 not to bad given the revenues


55,809

Marketing and promotional
80,063 Looks like they spend ALOT on marketing would like to see this number come down also the increase here wasnt matched

with revenue growth like it should


58,966

General and administrative
49,546 not to bad but pretty big jump that wasnt offset by revenues growth


28,545

Total costs and expenses
198,084 The cost are lower then the revenues so there making money


143,320

Operating income
52,353 52 MIllion in opperating income Holly Cow Wow!!! Down from the 86 Million they made last year and ill tell you why its

down its due to the higher cost of the marketing and the higher general adminstrative cost... that was not off set by a

higher increase in over all revenus revenues grew just not as fast as cost did...


86,112

Other income, net
683


673

Income before income taxes
53,036 53 Million they are making ALOT Of money


86,785

Income tax expense
19,995 20 Million in taxes


32,866

Net income
$
33,041 33 Million in net income VERY IMPRESSIVE


$
53,919

Earnings per share:



Basic
$
0.64 64 Cents yeah its down yoy because of the above noted reasons but still VERY IMpressive esp given where the stock is

currently trading at right now


$
1.02

Diluted
0.59


0.92

Weighted average number of common shares outstanding used in computing earnings per share:



Basic
52,008 Stock actually declined wonder if they have a buy back in place betting they do


52,976

Diluted
56,203


58,583


The Income statement is very impressive i see where they can cut some cost esp in marketing and on the general and

administrative side but with that said very impressive numbers still none the less esp since we are now able to buy the stock

near its book value were basically getting the revenues and net income and cash flows for FREE ILL TAKE THAT ANYDAY

Going to look at there cash flows but there cash flow positive big time

BRIDGEPOINT EDUCATION, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)

Three Months Ended
March 31,

2012

2011
Cash flows from operating activities



Net income
$
33,041


$
53,919

Adjustments to reconcile net income to net cash provided by operating activities:



Provision for bad debts
14,945


11,595

Depreciation and amortization
4,095


2,722

Amortization of premium/discount
1,754


587

Stock-based compensation
2,497


1,787

Excess tax benefit of option exercises
(3,588
)

(3,737
)
Loss on disposal of fixed assets



10

Changes in operating assets and liabilities:



Accounts receivable
(46,053
)

(28,449
)
Prepaid expenses and other current assets
(459
)

2,070

Student loans receivable
(2,399
)

(663
)
Other long-term assets
1,944


38

Accounts payable and accrued liabilities
27,505


27,093

Deferred revenue and student deposits
3,723


12,909

Other liabilities
3,345


1,579

Net cash provided by operating activities
40,350 Yup huge cash flows here


81,460

Cash flows from investing activities



Capital expenditures
(7,236
)

(5,170
)
Purchases of investments
(36,573
)

(53,930
)
Capitalized curriculum development costs
(1,638
)

(529
)
Sales and maturities of investments
28,923


10,000

Net cash used in investing activities
(16,524
)

(49,629
)
Cash flows from financing activities



Proceeds from the exercise of stock options
813


422

Excess tax benefit of option exercises
3,588


3,737

Proceeds from the exercise of warrants



19

Repurchase of common stock



(12,711
)
Net cash provided by (used in) financing activities
4,401


(8,533
)
Net increase in cash and cash equivalents
28,227


23,298

Cash and cash equivalents at beginning of period
133,921


188,518

Cash and cash equivalents at end of period
$
162,148


$
211,816

Supplemental disclosure of non-cash transactions:



Purchase of equipment included in accounts payable and accrued liabilities
$
1,465


$
500


Cash Flow positive to the tune of 40 MIllion bucks

with NO DEBT

very impressive

1. Nature of Business
Bridgepoint Education, Inc. (together with its subsidiaries, the "Company"), incorporated in 1999, is a provider of

postsecondary education services. Its wholly-owned subsidiaries, Ashford University and the University of the Rockies, are

regionally accredited academic institutions that offer associate's, bachelor's, master's and doctoral programs online, as

well as at their traditional campuses located in Clinton, Iowa, and Colorado Springs, Colorado.

Been in business since 1999 so thats nearly 13 years now

Education always does well when the economy goes down more people go back to school

Deferred revenue and student deposits consist of the following (in thousands):

As of
March 31, 2012

As of
December 31, 2011
Deferred revenue
$
63,299


$
48,831

Student deposits
125,870


136,615

Total deferred revenue and student deposits
$
189,169 This is HUGE its sitting on there balance sheet as a Liablity right... Because the services have not been provided

YET but if you back this out of the liablities side since this will become a asset in the future... That right there along

places stock holders equity at 583 Million Dollars... back out the 189 Million add that back into the stock holders equity

and ya


$
185,446

6 . Credit Facilities
January 2010 Credit Facility
During the three months ended March 31, 2012 , the Company maintained a $50 million revolving line of credit with Comerica

Bank ("Comerica") pursuant to a Credit Agreement, Revolving Credit Note and Security Agreement (collectively, the "Loan

Documents"). Under the Loan Documents, Comerica agreed to make loans to the Company and issue letters of credit on the

Company's behalf, subject to the terms and conditions of the Loan Documents. Amounts subject to letters of credit issued

under the Loan Documents were treated as limitations on available borrowings under the line of credit. Interest was to be

paid monthly under the line of credit, and principal was to be paid on the maturity date of the line of credit. Interest

would accrue on amounts outstanding under the line of credit, at the Company's option, at either (1) Comerica's prime

reference rate + 0.00% or (2) one month, two month or three month LIBOR + 2.25% . As security for the performance of the

Company's obligations under the Loan Documents, the Company granted Comerica a first priority security interest in

substantially all of the Company's assets, including its real property.
On March 30, 2012, the Company entered into a Sixth Amendment to Loan Documents with Comerica pursuant to which the maturity

date of the line of credit was extended to April 15, 2012. As of March 31, 2012 , the Company had no borrowings outstanding

under the line of credit. As of March 31, 2012 , the Company used the availability under the line of credit to issue letters

of credit aggregating $5.1 million .
The Loan Documents contained financial covenants requiring the Company's educational institutions to maintain Title IV

eligibility as well as the Company's maintenance of specified adjusted quick ratios, minimum profitability, minimum cash

balances and U.S. Department of Education ("Department") financial responsibility composite scores. The Loan Documents

contained other customary affirmative and negative covenants (including cash controls, financial reporting covenants and

prohibitions on acquisitions, dividends, stock redemptions and other cash expenditures over a specified amount without

Comerica's reasonable consent), representations and warranties and events of default (including the occurrence of a "material

adverse effect," as defined in the Loan Documents). The Company was in compliance with all financial covenants in the Loan

Documents as of March 31, 2012 .

They dont really need this credit facility they have tons of cash and liquid assets

for the three months ended March 31, 2012 , was 37.9% . The Company's effective income tax rate was 37.7% for the three

months ended March 31, 2012 . The effective rate for the three months ended March 31, 2012 , differed from the Company's

estimated annual effective tax rate due to the impact of discrete items on the Company's income before the provision for

income taxes, particularly interest accrued on unrecognized tax benefits and an adjustment to the value of the Company's net

deferred tax assets related to an increase in the effective state tax rate.
At both March 31, 2012 , and December 31, 2011 , the Company had gross unrecognized tax benefits of $8.1 million , of which

$5.8 million would impact the effective income tax rate if recognized.
The Company is subject to U.S. federal income tax and multiple state tax jurisdictions. The 2002 through 2011 tax years

remain open to examination by major taxing jurisdictions to which the Company is subject. The California Franchise Tax Board

commenced an audit of the Company's 2008 and 2009 California income tax returns in October 2011. The Company does not expect

any significant adjustments resulting from this audit.
The Company's continuing practice is to recognize interest and penalties related to uncertain tax positions in income tax

expense. Accrued interest and penalties related to uncertain tax positions as of both March 31, 2012 , and December 31, 2011

, was $1.4 million .

Compliance Audit by the Department's Office of the Inspector General ("OIG")
In January 2011, Ashford University received a final audit report from the OIG regarding the compliance audit commenced in

May 2008 and covering the period July 1, 2006 through June 30, 2007. The audit covered Ashford University's administration of

Title IV program funds, including compliance with regulations governing institutional and student eligibility, awards and

disbursements of Title IV program funds, verification of awards and returns of unearned funds during that period, and its

compensation of financial aid and recruiting personnel during the period May 10, 2005 through June 30, 2009.
The final audit report contained audit findings, in each case for the period July 1, 2006 through June 30, 2007, which are

applicable to award year 2006-2007. Each finding was accompanied by one or more recommendations to the Department's Office of

Federal Student Aid ("FSA"). If the FSA were to determine to assess a monetary liability or commence other administrative

action, Ashford University would have an opportunity to contest the assessment or proposed action through administrative

proceedings, with the right to seek review of any final administrative action in the federal courts.
Rosendahl v. Bridgepoint Education, Inc.
In January 2011, the Company received a copy of a complaint filed as a class action lawsuit naming the Company, Ashford

University and University of the Rockies as defendants. The complaint was filed in the U.S. District Court for the Southern

District of California and is captioned Rosendahl v. Bridgepoint Education, Inc. The complaint generally alleges that the

Company and the other defendants engaged in improper, fraudulent and illegal behavior in their efforts to recruit and retain

students.
The Company responded to the complaint by filing a motion to dismiss the complaint in its entirety and motions to strike

certain allegations in the complaint. The court allowed the matter to proceed on certain claims for alleged violations of the

Business and Professions Code, violations of the Consumer Legal Remedies Act, and negligent misrepresentations, but only as


14


BRIDGEPOINT EDUCATION, INC.
Notes to Condensed Consolidated Financial Statements (Unaudited) (Continued)

the specific alleged misrepresentations made to the named plaintiffs. The Company then moved to compel the plaintiffs' claims

to arbitration. In February 2012, the Court issued an order compelling the plaintiffs to arbitrate their claims against the

defendants and closed the court case. The Company has not yet received an arbitration demand from the plaintiffs.
Iowa Attorney General Civil Investigation of Ashford University
In February 2011, Ashford University received from the Attorney General of the State of Iowa (“Iowa Attorney General”) a

Civil Investigative Demand and Notice of Intent to Proceed (“CID”) relating to the Iowa Attorney General's investigation of

whether certain of the university's business practices comply with Iowa consumer laws. The CID contains no specific

allegations of wrongdoing. Pursuant to the CID, the Iowa Attorney General has requested documents and detailed information

for the time period January 1, 2008 to present. Ashford University continues to respond to the CID and intends to comply with

the Iowa Attorney General's request.
Stevens v. Bridgepoint Education, Inc.
In February 2011, the Company received a copy of a complaint filed as a class action lawsuit naming the Company, Ashford

University, LLC, and certain employees as defendants. The complaint was filed in the Superior Court of the State of

California in San Diego and is captioned Stevens v. Bridgepoint Education, Inc. The complaint generally alleges that the

plaintiffs and similarly situated employees were improperly denied certain wage and hour protections under California law.
In April 2011, the Company received a copy of a complaint filed as a class action lawsuit naming the Company and Ashford

University, LLC, as defendants. The complaint was filed in the Superior Court of the State of California in San Diego , and

is captioned Moore v. Ashford University, LLC. The complaint generally alleges that the plaintiff and similarly situated

employees were improperly denied certain wage and hour protections under California law.
In May 2011, the Company received a copy of a complaint filed as a class action lawsuit naming the Company as a defendant.

The complaint was filed in the Superior Court of the State of California in San Diego and is captioned Sanchez v. Bridgepoint

Education, Inc. The complaint generally alleges that the plaintiff and similarly situated employees were improperly denied

certain wage and hour protections under California law.
In October 2011, the cases captioned Moore v. Ashford University, LLC and Sanchez v. Bridgepoint Education, Inc. were

consolidated with Stevens v. Bridgepoint Education, Inc. , with Stevens v. Bridgepoint Education, Inc. designated as the lead

case, as the three cases involve common questions of fact and law.
In March 2012, the Company entered into a memorandum of understanding with the plaintiffs of the above named cases to

memorialize the terms of a settlement agreement among the parties. In April 2012, the Company signed a settlement agreement

with the plaintiffs which did not change the terms of the memorandum of understanding. Under the settlement agreement, which

is pending court approval, the Company agreed to pay to the plaintiffs an amount to settle their claims, plus any related

payroll taxes. As the Company determined that the loss related to settling the consolidated cases is both probable and

reasonably estimable, the Company accrued $10.8 million for such a loss during the three months ended March 31, 2012.
New York Attorney General Investigation of Bridgepoint Education, Inc.
In May 2011, the Company received from the Attorney General of the State of New York (“NY Attorney General”) a Subpoena Duces

Tecum (“Subpoena”) relating to the NY Attorney General's investigation of whether the Company and its academic institutions

have complied with certain New York state consumer protection, securities and finance laws. Pursuant to the Subpoena, the NY

Attorney General has requested from the Company and its academic institutions documents and detailed information for the time

period March 17, 2005, to present. The Company is responding to the Subpoena and intends to comply with the NY Attorney

General's request.
North Carolina Attorney General Investigation of Bridgepoint Education, Inc.
In September 2011, Ashford University received from the Attorney General of the State of North Carolina (“NC Attorney

General”) an Investigative Demand relating to the NC Attorney General's investigation of whether the university's business

practices complied with North Carolina consumer protection law. Pursuant to the Investigative Demand, the NC Attorney


15


BRIDGEPOINT EDUCATION, INC.
Notes to Condensed Consolidated Financial Statements (Unaudited) (Continued)

General has requested from Ashford University documents and detailed information for the time period January 1, 2008, to

present. The university continues to dialogue with the NC Attorney General and intends to comply with the NC Attorney

General's requests.

Looks like they have had some legal problems in the years past but looks like they have resolved most all of those issiues

Stock Repurchase Program
On April 30, 2012, the Company's board of directors authorized the repurchase of up to $75.0 million of the Company's

outstanding shares of common stock over the following 12 months. The repurchase program was authorized by the Company's board

of directors with the intention of creating additional value for stockholders. Under the repurchase program, the Company is

authorized to purchase shares from time to time in the open market, through block trades or otherwise. No shares have yet

been repurchased under this program.

They are buying back stock they should take full advantage of the current stock price to load up cheap ill be sure to tell

them that when they call me back
Overview
Background
We are a provider of postsecondary education services. Our regionally accredited academic institutions, Ashford University

and University of the Rockies, offer associate's, bachelor's, master's and doctoral programs online as well as at their

traditional campuses located in Clinton, Iowa and Colorado Springs, Colorado. As of March 31, 2012 , our institutions offered

approximately 1,430 courses, 85 degree programs and 140 specializations. We are also focused on developing innovative new

technologies to improve the way students learn, such as Constellation, Thuze and Waypoint Outcomes, and the mobile learning

platforms for our institutions.
Key operating data
In evaluating our operating performance, our management focuses in large part on (i) revenue, (ii) operating income and (iii)

period end enrollment at our institutions (online and campus-based). The following table, which you should read in

conjunction with our condensed consolidated financial statements contained elsewhere in this report, presents our key

operating data for the three months ended March 31, 2012 and 2011 (in thousands, except for enrollment data):





Enrollment at our academic institutions grew from 86,642 at December 31, 2011 , to 94,863 at March 31, 2012 , an increase of

9.5% . In the three months ended March 31, 2012 , we had new student enrollments of approximately 24,275 , compared with new

student enrollments of approximately 27,550 for the same period in 2011 , a decrease of 11.9% . The following table presents

new student enrollments for the most recent five quarters and compares them to the same periods in the previous year:

So they have more students then i thought

In recent quarters, we have experienced a decline in new student enrollments. We believe the primary driver for the lower new

student enrollments during the first three months of 2012 was the change in compensation methodology for certain personnel

required by Department regulations that became effective on July 1, 2011, which resulted in our admissions counselors having

lower productivity levels. Additionally, we believe the new student enrollments have been impacted by the student quality and

preparedness initiatives we implemented in the two most recent fiscal years, as well as the negative media scrutiny of our

company and the private sector postsecondary education industry in general. However, after observing admissions counselor

productivity over the past three quarters, we believe that new student enrollments will grow in 2012 as compared to 2011.
Anticipated future trends in results of operations
In recent years, we have seen total student enrollment and revenue continue to increase despite difficult general economic

conditions, and have not experienced any significant negative impact from the fluctuation in general economic conditions on

our liquidity, capital resources or results of operations. While we cannot guarantee that these trends will continue, we

believe that the performance of our company has been resilient in the current economic environment due to the continued

availability of Title IV funds to finance student tuition payments and the continuing demand for postsecondary education.
In 2012, we plan to continue to invest in admissions counselors and in online and other advertising, including pursuant to a

recently launched branding campaign for us and our institutions. We expect these efforts will result in (1) an increase in

new student enrollment compared to 2011 and (2) our total student enrollment and revenue otherwise continuing to grow, though

perhaps not at the same rate as in the past, particularly given the larger size of our enrollment base and recent changes in

the


18

regulatory environment, including the final incentive compensation regulations that became effective on July 1, 2011.

Additionally, we expect increases in marketing costs related to the branding campaign and the hiring of new admissions

counselors, which will likely result in a decrease in our operating income in 2012 as compared to 2011.
Liquidity and capital resources and anticipated capital expenditures
We have financed our operating activities and capital expenditures during 2012 and 2011 primarily through cash provided by

operating activities. At March 31, 2012 , we had cash, cash equivalents and investments totaling $442.1 million and no

long-term debt. Based on our current level of operations and anticipated growth in enrollments, we believe that our cash flow

from operating activities, our existing cash and cash equivalents and other sources of liquidity will provide adequate funds

for ongoing operations, planned capital expenditures and working capital requirements for at least the next 12 months. For

the year ending December 31, 2012 , we expect capital expenditures to be approximately $41.0 million.
Recent Developments
WASC Site Visit of Ashford University. In March 2012, Ashford University hosted a site visit team from the Accrediting

Commission for Senior Colleges and Universities of the Western Association of Schools and Colleges (“WASC”). The purpose of

the site visit was to validate the information provided in the institution's application for regional accreditation from

WASC, particularly its compliance with WASC standards and criteria for review. The next step in the accreditation process is

for the site visit team to submit a final team report to WASC. Before the submission of the final team report to WASC,

Ashford University will be given an opportunity to review the report for correction of errors of fact and to prepare a

written response to the final team report, which will be provided to WASC for consideration along with the report. The site

visit team will also submit a confidential recommendation to the WASC Commission as to whether or not the institution should

be accredited. This confidential recommendation is separate from and not included with the final team report and is not

shared with the institution. If upon review of the application and supporting documentation, including the team report and

the institution's response, Ashford University is found to be in substantial compliance with all of WASC's standards, WASC

may grant initial accreditation, typically with a comprehensive review cycle of five years. Depending on the circumstances,

WASC may also grant initial accreditation with requirements for interim reports, special visits or both. If initial

accreditation from WASC is secured, then Ashford University will commence the process of redesignating its primary

institutional accreditor from the Higher Learning Commission to WASC.
Settlement of Class Action Lawsuits. In March 2012, we entered into a memorandum of understanding with the plaintiffs of the

cases consolidated under Stevens v. Bridgepoint Education, Inc. to memorialize the terms of a settlement agreement among the

parties. In April 2012, we signed a settlement agreement with the plaintiffs which did not change the terms of the memorandum

of understanding. Under the settlement agreement, which is pending court approval, we agreed to pay to the plaintiffs an

amount to settle their claims, plus any related payroll taxes. As we determined that the loss related to settling the

consolidated cases is both probable and reasonably estimable, we accrued $10.8 million for such loss during the three months

ended March 31, 2012. For more information regarding the consolidated cases, see Part II, Item 1 (Legal Proceedings) of this

report.
April 2012 Credit Facility. In April 2012, we entered into a $50 million revolving line of credit ("New Facility") pursuant

to an Amended and Restated Revolving Credit Agreement ("Revolving Credit Agreement") with the lenders signatory thereto and

Comerica Bank ("Comerica"), as administrative agent for the lenders. The Revolving Credit Agreement amends, restates and

supersedes the Credit Agreement dated January 29, 2010, as amended, with Comerica. At the company's option, we may increase

the size of the New Facility up to $100 million (in certain minimum increments), subject to the terms and conditions of the

Revolving Credit Agreement. Additionally, we may request swing-line advances under the New Facility up to $3 million in the

aggregate. For more information regarding the Revolving Credit Agreement and the New Facility, see Note 6 , “ Credit

Facilities ,” to our condensed consolidated financial statements which are included elsewhere in this report.
Seasonality
Our operations are generally subject to seasonal trends. While we enroll students throughout the year, our fourth quarter

revenue generally is lower than other quarters due to the holiday break in December. We generally experience a seasonal

increase in new enrollments in August and September of each year when most other colleges and universities begin their fall

semesters.

So business should start to pick up in the coming months


hree Months Ended March 31, 2012 , Compared to Three Months Ended March 31, 2011
Revenue. Our revenue for the three months ended March 31, 2012 , was $250.4 million , representing an increase of $21.0

million , or 9.2% , as compared to revenue of $229.4 million for the three months ended March 31, 2011 . This increase was

primarily due to a tuition increase of 5% which was effective April 1, 2011. The tuition increase accounted for approximately

54.8% of the $21.0 million revenue increase between periods. In addition to the tuition increase, the revenue increase was

also positively impacted by the enrollment growth of 7.5% , from 88,252 students at March 31, 2011 , to 94,863 students at

March 31, 2012 . Enrollment growth is driven by various factors including prospective students' acceptance of our educational

offerings, the quality of lead generation efforts, the number of admissions counselors and our ability to retain existing

students. The increase in revenue was partially offset by an increase in institutional scholarships of $8.5 million in the

aggregate between periods. We earned technology fees of $15.8 million for the three months ended March 31, 2012 ,

representing 6.3% of total revenue during the period, compared to technology fees of $18.7 million for the three months ended

March 31, 2011 , representing 8.1% of total revenue during that period. The decrease in technology fees is primarily due to

the 11.9% decline in new student enrollments between periods.
Instructional costs and services. Our instructional costs and services for the three months ended March 31, 2012 , were

$68.5 million , representing an increase of $12.7 million , or 22.7% , as compared to instructional costs and services of

$55.8 million for the three months ended March 31, 2011 . This increase was primarily due to additional costs necessary to

support increased student enrollment. Specific increases between periods were direct compensation in the areas of academic

management, financial aid support and student services of $6.1 million, bad debt expense of $3.4 million, instructor fees of

$2.0 million and facilities costs of $1.4 million. Instructional costs and services increased, as a percentage of revenue, to

27.3% for the three months ended March 31, 2012 , as compared to 24.3% for the three months ended March 31, 2011 . The

increase of 3.0% , as a percentage of revenue, included relative increases in direct compensation of 1.8%, an increase of

0.9% in bad debt expense to 6.0% for the three months ended March 31, 2012 , compared to 5.1% for three months ended March

31, 2011 , and increases in instructor fees and facilities costs of 0.4% each. The relative increases were partially offset

by a relative decrease in financial aid processing fees of 0.8%. The relative increase in bad debt expense was due to weak

general economic conditions and the timing of internal collections efforts; we continue to enhance our processes to improve

this metric.
Marketing and promotional expenses. Our marketing and promotional expenses for the three months ended March 31, 2012 ,

were $80.1 million , representing an increase of $21.1 million , or 35.8% , as compared to marketing and promotional expenses

of $59.0 million for the three months ended March 31, 2011 . The increase was primarily due to the growth of our admissions

counselor workforce, as well as costs incurred for expanded marketing and branding efforts. Specific factors contributing to

the overall increase between periods were increases in selling compensation of $11.5 million, advertising costs

There cost went up but so did there revenues cost are still well inline tho with revenues and growth is there as well


21

of $6.2 million and facilities costs of $2.0 million. The increase in selling compensation and advertising spending is

expected to continue as we grow our admissions counselor workforce and increase our lead generation efforts to support such

personnel. Our marketing and promotional expenses, as a percentage of revenue, increased to 32.0% for the three months ended

March 31, 2012 , from 25.7% for the three months ended March 31, 2011 . The increase of 6.3% as a percentage of revenue was

mainly due to the relative increases in selling compensation of 3.4%, advertising costs of 1.9% and facilities costs of 0.5%.
General and administrative expenses. Our general and administrative expenses for the three months ended March 31, 2012 ,

were $49.5 million , representing an increase of $21.0 million , or 73.6% , as compared to general and administrative

expenses of $28.5 million for the three months ended March 31, 2011 . The overall increase between periods was primarily due

to an accrual of $10.8 million related to a settlement agreement for three consolidated lawsuits that was recorded in the

three months ended March 31, 2012 . Other increases between periods were administrative compensation of $4.8 million,

consulting and outside services of $1.4 million and facilities costs of $0.7 million. Our general and administrative

expenses, as a percentage of revenue, increased to 19.8% for the three months ended March 31, 2012 , from 12.5% for the three

months ended March 31, 2011 . The increase of 7.3% included relative increases for the settlement accrual of 4.3%,

administrative labor of 1.4% consulting fees and outside services of 0.5%.
Other income, net. Other income, net, was $0.7 million for both the three months ended March 31, 2012 and 2011 .
Income tax expense. We recognized income tax expense for the three months ended March 31, 2012 and 2011 , of $20.0

million and $32.9 million , respectively, at effective tax rates of 37.7% and 37.9% , respectively. The decrease in our

effective tax rate between periods was primarily due to an adjustment to the value of our net deferred tax assets related to

an increase in our state effective tax rate.
Net income. Net income was $33.0 million for the three months ended March 31, 2012 , compared to net income of $53.9

million for the three months ended March 31, 2011 , a decrease of $20.9 million , as a result of the factors discussed above.
Liquidity and Capital Resources
We financed our operating activities and capital expenditures during the three months ended March 31, 2012 and 2011 ,

primarily through cash provided by operating activities. Our cash and cash equivalents were $162.1 million at March 31, 2012

, and $133.9 million at December 31, 2011 . At March 31, 2012 , and December 31, 2011 , we had investments of $280.0 million

and $273.3 million , respectively.
We manage our excess cash pursuant to the quantitative and qualitative operational guidelines of our cash investment policy.

Our cash investment policy is managed by our chief financial officer and has the following primary objectives: preserving

principal, meeting our liquidity needs, minimizing market and credit risk, and providing after-tax returns. Under the

policy's guidelines, we invest our excess cash exclusively in high-quality, U.S. dollar-denominated financial instruments.

For a discussion of the measures we use to mitigate the exposure of our cash investments to market risk, credit risk and

interest rate risk, see Part I, Item 3, "Quantitative and Qualitative Disclosures About Market Risk," of this report.
We noted an increase in fair value of our short and long-term investments at March 31, 2012 , as compared to December 31,

2011. We believe that the increase is due to market response to the stabilization of credit ratings and the on-going

financial recoveries of many major U.S and world banks. We believe that the fluctuations we have recently experienced are

temporary in nature and we maintain that while some our securities are classified as available-for-sale, we have the ability

and intent to hold them until maturity, if necessary, to recover the value.
Available borrowing facilities
For the three months ended March 31, 2012 , we were party to a $50 million revolving line of credit (the "Old Facility")with

Comerica Bank ("Comerica") pursuant to a Credit Agreement, Revolving Credit Note and Security Agreement (collectively, the

"Loan Documents"). On April 13, 2012, the Company entered into a new revolving line of credit ("New Facility") pursuant to an

Amended and Restated Revolving Credit Agreement ("Revolving Credit Agreement") with the lenders signatory thereto and

Comerica as administrative agent. The Revolving Credit Agreement and the New Facility amend, restate and supersede the Old

Facility. At the company's option, we may increase the size of the New Facility up to $100 million (in certain minimum

increments), subject to the terms and conditions of the Revolving Credit Agreement. Additionally, the Company may request

swing-line advances under the New Facility up to $3 million in the aggregate. For more information



Off-Balance Sheet Arrangements
As part of our normal business operations, we are required to provide surety bonds in certain states where we do business. In

May 2009, we entered into a surety bond facility with an insurance company to provide such bonds when required. As of March

31, 2012 , our total available surety bond facility was $12.0 million and the surety had issued bonds totaling $9.8 million

on our behalf under such facility.



Done with this SEC Filing love the balance sheet love the income statement and cash flows statement very strong buy no

worries at all now after doing the above DD buying and holding this stock at the current price

Need to continue on with the DD The reason for the drop and can this be resolved

There is a few 8k Filings let have a look first one

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=8716124-843-8705&type=sect&dcn=0001305323-12-000034

Item 8.01 Other Information.

Notification from Higher Learning Commission regarding Special Monitoring

On July 12, 2012, Bridgepoint Education's subsidiary, Ashford University, received a letter from the Higher Learning

Commission of the North Central Association of Schools and Colleges (“H LC”) requiring Ashford University to provide certain

information and evidence of compliance with HLC accreditation standards. HL C is a regional accrediting body recognized by

the U.S. Department of Education and is the principal accreditor of Ashford University and its programs. The HLC letter

relates to the recent visiting team report and action letter received by the University from the Accrediting Commission for

Senior Colleges and Universities of the Western Association of Schools and Colleges (“WASC”) on July 5, 2012.
The letter requires that Ashford University submit a report to HLC no later than August 10, 2012 that will be followed by an

Advisory Visit that will occur no later than October 9, 2012. The University's report must demonstrate that the University

remains in compliance with the HLC's Criteria for Accreditation and include: (i) evidence that Ashford University meets the

HLC Criteria for Accreditation relating to the role and autonomy of the University's governing board and its relationship

with Bridgepoint Education, including the role of faculty in overseeing academic policies and the integrity and continuity of

academic programs, (ii) evidence that Ashford University's resource allocations are sufficiently aligned with educational

purposes and objectives in the areas of student completion and retention, the sufficiency of full-time faculty and model for

faculty development, and plans for increasing enrollments, and (iii) evidence demonstrating that Ashford University has an

effective system for assessing and monitoring student learning and assuring academic vigor.
The letter states that HLC's President will present the report of the Advisory Visit team and the President's recommendation

to the HLC Board for action at its February 2013 meeting. At that meeting, the HLC Board may act to continue accreditation,

with or without further monitoring, continue accreditation under sanction or “Show Cause” order, or withdraw accreditation.

The letter further states that Ashford University would be scheduled for a HLC Board Committee Hearing prior to any Board

action to withdraw accreditation. HLC policies also provide for a right to appeal any Board action to withdraw accreditation.
Ashford University believes it is in substantial compliance with the HLC accreditation criteria and Bridgepoint Education and

Ashford University intend to cooperate fully with HLC in this matter.
Special Note Regarding Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements including, without limitation, statements regarding

Ashford University's plans in response to the Higher Learning Commission's communication regarding the institution's

compliance with its accreditation requirements. These statements involve risks and uncertainties, and actual results may

differ materially from those expressed in or suggested by such statements. Such risks and uncertainties include, without

limitation: the inability of Ashford University to demonstrate to the Higher Learning Commission its compliance with the

Commission's accreditation requirements, which could lead to a loss of accreditation and eligibility to participate in Title

IV programs; and uncertain costs, management distraction and potential business disruption.
More information on potential factors that could affect our future results is included from time to time in the “Risk

Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” sections of our periodic

reports filed with the SEC, including, without limitation, our Annual Report on Form 10-K for the year ended December 31,

2011, filed with the SEC on March 7, 2012, and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, filed

with the SEC on May 1, 2012.
Forward-looking statements are made on the basis of management's views and assumptions regarding future events and business

performance as of the time the statements are made, and Bridgepoint Education assumes no obligation to update any

forward-looking statements or information, which speak as of their respective dates, except as required by law.




SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report

to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 13, 2012

Bridgepoint Education, Inc.




By:
/s/ Diane L. Thompson


Name: Diane L. Thompson


Title: Senior Vice President, Secretary and General Counsel

Ok lets read this VERY Carefully... First off no action will be taken till 2013... Thats Next Year... so clearly the stock

way over reacted on the news...


Ashford University believes it is in substantial compliance with the HLC accreditation criteria and Bridgepoint Education and

Ashford University intend to cooperate fully with HLC in this matter.

So basically they are going to visit the college and make sure that they are going in lines with there accrediation guidlines

and since they have a advance warning you can bet that they are going to be very prepared for this visit and be on there ps

and qs...

Next 8k

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=8709316-852-9810&type=sect&dcn=0001305323-12-000032

Item 8.01 Other Information.

Denial of Initial Accreditation for Ashford University

On July 5, 2012, Ashford University received official notice from the Accrediting Commission for Senior Colleges and

Universities of the Western Association of Schools and Colleges ("WASC") that WASC has acted (1) to deny initial

accreditation to the institution and (2) to permit the institution to reapply for accreditation with a single special visit

to occur as early as spring 2013. This reapplication process would allow WASC to act in June 2013 and does not require

Ashford University to undertake another full self-study.

WASC found that Ashford University had not yet demonstrated substantial compliance with certain of the WASC Standards for

Accreditation, as would be required for initial accreditation. Ashford University intends to appeal this decision and

simultaneously to undertake the process for reapplying for initial accreditation. Under WASC rules, if Ashford University

decides to reapply for accreditation, the institution will be required to demonstrate that it has satisfactorily addressed

the report's conclusions and has come into compliance with the WASC Standards of Accreditation.

A copy of the visiting team report and WASC action letter from the review of Ashford University will be available on the WASC

website at www.wascsenior.org.

Ashford University remains regionally accredited by the Higher Learning Commission of the North Central Association of

Colleges and Schools ("Higher Learning Commission"), with the next comprehensive evaluation scheduled for 2014-15. Ashford

University intends to work collaboratively with both WASC and the Higher Learning Commission to ensure it continues to

satisfy the Higher Learning Commission's accreditation requirements while it seeks accreditation with WASC.

Notification from Higher Learning Commission regarding Jurisdiction over Ashford University

On June 25, 2012, the Higher Learning Commission informed Ashford University that the institution must demonstrate, no later

than December 1, 2012, that it has a "substantial presence," as defined by commission policy, in the 19-state north central

region and accordingly is within the Higher Learning Commission's jurisdiction under new requirements which became effective

on July 1, 2012. Ashford University is communicating with the Higher Learning Commission regarding the timing and components

of becoming compliant with the commission's jurisdictional requirements in light of the institution's plans to reapply for

initial accreditation with WASC.

If Ashford University is required to comply with the Higher Learning Commission's jurisdictional requirements, it is expected

that the institution would need to consolidate a significant portion of its educational administration and activity, business

operations and executive and administrative leadership in the 19-state north central region. Additionally, if Ashford

University is unable to demonstrate in a timely manner that it has a substantial presence in the north central region, the

Higher Learning Commission has stated that it will begin a process of reconsidering the institution's accreditation. Ashford

University intends to maintain its accreditation with the Higher Learning Commission until such time as it can transfer its

accreditation to WASC.


So looks like they lost there accrediation but they are working to get it back sounds like a temp problem to me

Next 8k Form

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=8629486-866-7545&type=sect&dcn=0001305323-12-000030

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory

Arrangements of Certain Officers.

On May 15, 2012, the Compensation Committee adopted the 2012 Executive Profit Sharing Plan ("2012 Plan") for Messrs. Andrew

S. Clark, Daniel J. Devine and Rodney T. Sheng, Dr. Jane L. McAuliffe and Ms. Diane L. Thompson (collectively, the "named

executive officers"). Under the 2012 Plan, the payment to the named executive officers of annual performance-based cash

bonuses related to 2012 performance will be based on the achievement of corresponding company-wide performance targets

related to quality, EBITDA and revenue, with each respective metric receiving one-third of the weighting. There will be no

individual performance metrics. The performance target for quality will require the achievement by our company in 2012 of

certain quality metrics based on cohort default rates, 90/10 ratio, net promoter score, employee retention, and the

development and enhancement of certain predictive modeling and learning tools.

The Compensation Committee has determined that the 2012 target bonus amounts for Messrs. Clark, Devine and Sheng would be

100%, 65% and 75%, respectively, of their annual base salaries, and that the 2012 target bonus amounts for Dr. McAuliffe and

Ms. Thompson would be 55% and 35%, respectively, of their annual base salaries. Actual bonus amounts paid to the named

executive officers may be or more or less than the target bonus amounts. For 2012, the Compensation Committee determined that

(1) the minimum or threshold bonus amount for each named executive officer will be 50% of the officer's target bonus amount,

and (2) the maximum bonus amount for each named executive officer will be 200% of the officer's target bonus amount. The

Compensation Committee has the discretion to award bonus amounts that fall in between the threshold, target and maximum

amounts for attainment of performance that falls in between the specified goals.

Item 5.07. Submission of Matters to a Vote of Security Holders.
On May 14, 2012, we held our 2012 Annual Meeting of Stockholders at which the stockholders (1) elected Andrew S. Clark and

Patrick T. Hackett as Class III directors for a three-year term to expire at the 2015 Annual Meeting of Stockholders and (2)

ratified the selection of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year ending

December 31, 2012.
The final voting results on these matters were as follows:
Proposal 1 - Election of two Class III directors for a three-year term to expire at the 2015 Annual Meeting of

Stockholders:
Name

Votes For

Votes Withheld

Votes Abstained

Broker Non-Votes
Andrew S. Clark

42,824,769


2,932,669




3,247,486

Patrick T. Hackett

45,372,108


385,330




3,247,486

Proposal 2 - Ratification of selection of PricewaterhouseCoopers LLP as our independent registered public accounting firm

for the year ending December 31, 2012:
Votes For

Votes Against

Votes Abstained

Broker Non-Votes
48,868,306


108,239


28,379



Thats just pay for the people running the company

Ok overall love the balance sheet the income statement the cash flows this all comes down to them being accredited i think

that they will keep there accrediation they have plenty of time to prepare and take the necessary actions to be prepared to

be accredited they have been for over 12 years now

I think that they can make the necessary changes to get there accrediation back at the current price there really is not much

downside risk as the companys balance sheet provides protection but the upside here could be huge once the company gets this

behind them... Based on the Above DD I give the stock a Strong Buy Rating at the current price and market cap given the chart

fundamentals and over all sistution... DD Given


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