Reforming the Future of Student Loan Lenders
Evan ReichWednesday, April 28th, 2010
President Obama’s signing of the Health Care and Education Reconciliation Act will have unintended effects on the education industry as it eliminates the Federal Family Education Loan Program (FFELP). From the investor’s point of view, what does this all mean for standalone student loan companies, banks, and for-profit education companies?
One element that’s easy to agree on is that a lot of jobs will be lost. The only traction the student lending industry generated in opposition to the bill was based on the prospect of significant job loss - that’s now a reality. Sallie Mae has announced its intention to cut 2,500 jobs and a number of small lenders have indicated their intention to exit the marketplace altogether.
The for-profit segment of the education industry is also under siege. The Department of Education’s proposed “gainful employment” regulation is likely to affect as much as 25% of the programs offered at numerous for-profit schools.
The third factor affecting student lenders comes from bankruptcy loan reform. Beginning in 2014, loan payments will be capped at 10% of a borrower’s discretionary income, down from the current 15% cap. Moreover, any borrowed amount not paid after 20 years, compared to today’s 25 years, will be forgiven and public service workers will earn forgiveness in just ten years. This will have a long-term, sizable affect on the student loan market.
![[Post to Twitter]](http://www.pg-research.com/blog/wp-content/plugins/tweet-this/icons/tt-twitter.png){kind=icon}
Tags: direct loan, ffelp loans, investors, layoffs, private student loans, Sallie Mae, student loan lenders, student loan reform, student loans bill, student loans obama
Posted in Uncategorized | No Comments »
Challenges Continue for Global Financial Exchanges
Evan ReichMonday, April 26th, 2010
Looking at the current state of the market, our experts see challenges affecting the global platforms, MTFs and exchanges. From 2006 to 2008, there was an explosion of mergers and acquisitions intended to consolidate volume and capture economies of scale and of new entrants to the global trading platform and exchange space with the goal of stealing volume from the biggest players through improved execution, smarter routing, more efficient large block trades and lower costs.
However, active M&A and new entry has come to an end as capital has become scarce with the cooling of the market. In all likelihood, we are looking at a status quo situation until capital is available to properly integrate the previous wave of acquisitions. But it is worth noting that there are some major players who largely sat out the last round may be well positioned to take advantage of the next wave, namely the Deutsche Borse and Asian exchanges.
Tags: Asian stock exchanges, deutsche borse exchange, financial exchanges, london stock exchange, lse london, MTFs, stock market exchanges, trading platform market, trading platforms reviews, world stock exchanges
Posted in Author | No Comments »
Eyes On Outdoor Advertising
Lloyd WalmsleyWednesday, April 21st, 2010
Experts are optimistic that Eyes On, the billboard advertising industry’s new rating system, will draw dollars into outdoor advertising but the impact will not be apparent until 2011 or beyond. The Eyes On rollout is moving slowly but it will soon replace the current standard of DEC numbers. We queried our network of outdoor advertising experts to better understand how the new ratings system could drive more dollars to the medium.
Eyes On versus DEC: Eyes On is used by some outdoor companies alongside the historical Daily Effective Circulation (DEC) measurement system. DEC ratings multiply traffic data by an estimate of people per car to measure the “opportunity to see” a billboard. Eyes On supplements traffic count and regional demographics with discounts for view obstructions, road type, and ad proximity, size, and angle to measure those “likely to see” a billboard. Eyes On provides a more reliable measure of audience and an improved level of demographic targeting that can be compared to other forms of broadcast media, including TV and radio.
Attract Ad Dollars: PGR experts on the Outdoor Advertising sell-side are cautiously optimistic that Eyes On can tap into new ad budgets that previously spent little on Outdoor due to its relatively unsophisticated measurement system. More dollars stand to be allocated to Outdoor with this deeper integration into the media budget process. After all, Outdoor still compares favorably to TV and radio on a cost per mille basis in key demos. This increasing drive for efficiency and metric driven advertising could lead Eyes On to favor Outdoor.
Expect Lower Ratings: Eyes On ratings, because of the discounts, tend to run approximately 30% lower than DEC ratings and experts note the lower ratings are exacerbated on highway billboards further from the road. While the Outdoor advertising sales process is not done strictly on ratings, one wonders if more accurate ratings could lead to budget shifts away from higher priced boards.
Limited Market Impact: Clear Channel Outdoor is the only company, according to experts, currently using Eyes On. Some experts have yet to see Eyes On ratings in the market at all. Mom and pops and smaller regional players are likely to be slow to make the transition.
Stronger Outdoor Market: Experts indicate the Outdoor market has begun to see the impact of an improving economy. However enthusiasm in the Outdoor space appears muted, especially when compared to excitement for a rebound in online advertising (display and search) as well in TV advertising - PGR experts report strong 1Q trends and further tightening of inventory and rising prices into 2Q. Outdoor is improving but appears to be lagging other advertising.
Tags: advertising cost, billboard advertising, cbs outdoor, cost of advertising, daily effective circulation, eyes on, outdoor advertising market, outdoor billboard advertising, outdoor media, outdoor media advertising, trends in advertising
Posted in Author, Lloyd Walmsley, Media & Internet | No Comments »
Search for Advertising Dollars
Lloyd WalmsleyTuesday, April 20th, 2010
PGR experts in online advertising report strong growth in 1Q and signs of further improvement in 2Q. While marketers report clear growth in ad budgets, they note that clients continue to show signs of hesitancy with short notice on requests for proposals, heavy reliance on the spot market and a vigilant focus on ROI and metric-driven forms of advertising.
Experts indicate that search advertising is leading the way out of the recession, and Google continues to hold/gain share of search spending. SEMs expressed a positive reception to Yahoo’s new network distribution tool and some shift in budgets away from Yahoo affiliate sights towards Yahoo O&O sites, a clear positive from a margin perspective. That said, no marketers report spending more ad dollars on Yahoo Search in aggregate. Furthermore, many experts postulate Bing will continue to seize search advertising market share and the prevalence of this view could impact how marketers are inclined to allocate search dollars.
In online display advertising, PGR experts report a firming marketplace, higher prices, and increasing interest in tight integration of ad units with premium content sites. Experts are upbeat on the Google display product over the long-term, but there is a mixed reaction at AOL as some experts note continuing unrest among sales representatives, which may reflect the ongoing challenges within the business.
But change is ahead. Increased smartphone penetration and media consumption from industry leaders Quattro (AAPL), AdMob (GOOG) and JumpTap is driving experts to predict increased investments in mobile advertising for the year ahead.
Tags: aapl, GOOG, google online advertising, internet advertising trends, jumptap, mobile advertising market, mobile marketing, online advertising marketplace, online advertising revenue, online marketing trends, quattro, search advertising, search engine marketing, search marketing, yahoo o&o
Posted in Internet, Lloyd Walmsley, Media & Internet | No Comments »
SAP As Expected
Laxmi PoruriMonday, April 12th, 2010
PGR experts report that their System Analysis and Program Development (SAP) has been in line with expectations. Experts are still seeing slow growth in the Enterprise Resource Planning (ERP) sector, but some more bullish European experts believe the recovery of IT spending in Europe will contribute to solid pipeline.
Experts report that HR and CRM modules continue to lose out as cost considerations drive customers toward SAAS players like CRM and ORCL PSFT. Experts also found that flexibility on maintenance pricing is still aggressive. Some resellers think this will help close more deals relative to last year at the expense of margins. Other resellers cite an increase in upgrades and strong demand for ERP Central Component (ECC) 6.0. Overall, most agree that growth for SAP is tied to a slow economic recovery and not product cycle.
Tags: erp crm, erp sap, oracle saas, saas model, saas software, sap crm future, sap ecc, sap ecc 6.0, sap erp, sap erp 6.0, sap service market, sap software, sap system, service sap marketplace, software industry, stock orcl
Posted in Author, Laxmi Poruri, Technology | No Comments »
Peripheral Atherectomy Industry: CSI’s Diamondback 360 still gaining on ev3’s SilverHawk
Allison HsiehWednesday, April 7th, 2010
PGR network indicates that while the SilverHawk is still the market leader in the peripheral atherectomy space, physicians often choose the Diamondback over the Silverhawk, particularly in cases below-the-knee. The SilverHawk, EVVV’s pioneering endovascular surgical device from its acquisition of FoxHollow, has been facing competition from new players in the market over the past few years, most notably from Cardiovascular Systems, Inc.’s (CSII) Diamondback 360 and Pathway Medical’s Jetstream G2. The Jetstream does not seem to be making an impression on the market, but the SilverHawk and Diamondback continue to carve out their respective niche markets, further shifting market share.
Tags: cardiovascular systems inc, CSII, diamondback 360, diamondback 360 csi, ev3, ev3 medical, EVVV, foxhollow technologies, medical device companies, pathway medical technologies, silverhawk, silverhawk athrectomy, silverhawk ev3
Posted in Allison Hsieh, Author, Health Care, Health Care Services | 1 Comment »
Student Lending Leads to Job Loss
Evan ReichTuesday, April 6th, 2010
A lot of jobs will likely be lost with President Obama’s signing of the student lending bill. This bill will clearly have a significant effect on the education industry, but it also will have an unintended effect on investors. For standalone student loan companies, banks, and for-profit education companies this bill makes the prospect of significant job loss a reality.
Tags: employment student loan reform, job loss, private lenders, student loan obama, student loan reform, student loans
Posted in Uncategorized | No Comments »