HCBE Theses and Dissertations

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Date of Award


Document Type

Dissertation - NSU Access Only

Degree Name

Doctor of Business Administration (DBA)


H. Wayne Huizenga School of Business and Entrepreneurship


Michael Bendixen

Committee Member

Yuliya Yurova

Committee Member

Edward R Walker


The objective of this research is to test human capital theory via the earnings announcements through the returns within the for-profit education and training services industry. This theory posits that enrollment levels would rise during recessionary periods and this should be reflected in better earnings announcements of the education firms.

Data was retrieved from the Compustat, CRSP, Thompson IBES, Google Finance, and Yahoo! Finance databases spanning the recessionary years of 2008 through 2010. The first hypothesis utilized a price index weighted by the education firms' market capitalization and the Russell 3000 Index as a proxy for the market to assess the daily returns of the education industry relative to the market. The second and third hypotheses involved assessing the quality of the earnings announcements within the education industry on a Friday vs. non-Friday report basis. The fourth hypothesis explored the actual EPS vs. forecasted EPS in consecutive quarters to test for differences in the earnings of that are better-than and those that are the same-or-worse than expected. The final hypothesis utilized the cumulative abnormal returns and cumulative excessive returns methodologies to compare the performance of the periods before and after the announcements.

No support for the first four hypotheses was found. Consistent with expectations established by other research using CAR and CER methodologies, the fifth hypothesis was supported. Support for human capital theory was not found because four hypotheses were unsupported.

This study was limited to U.S. education firms that were publicly traded on major U.S. exchanges. No private for-profit or non-profit firms were included in this study.

Knowledge was gained by exploring the earnings announcements of the education industry for evidence of human capital theory. The absence of support for the theory within the industry during a recession could be an indicator of other issues affecting the industry that need to be researched further before any conclusions can be reached.

This study extends the research in earnings announcements by examining the relationship the education industry has with the market. It also contributes to the work in human capital theory by testing the education industry's performance during recessionary years.

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