Apollo Education Group’s first investor day since 2006 helped shed light on a business in transition and the deep and qualified leadership team behind the transition, but lacked incremental quantitative support for the next leg up in the company’s recovery. Management still believes the core domestic degree business can return to modest growth through a gradual recovery in new enrollment, stronger retention, and further fixed cost cuts, but indicated that excess capital will increasingly shift toward international expansion, where growth prospects are stronger.

While no new quantitative support was provided, management continues to believe it is on the path to stabilizing the core domestic degree business through a combination of more career-focused marketing, continued retention gains, and incremental fixed cost cuts.Management is focused on unlocking the balance sheet. The first priority for the $7.42 a share in net cash will be international expansion through acquisitions in Apollo Global, with share buybacks a secondary usage.

Diversification away from the core degree product is clearly a focus, not just internationally, but through more career-oriented education offerings domestically, including vocationally focused, “stackable” certificates that will ideally provide learners with milestones and new career opportunities along the path to a degree that should stimulate stronger retention and student outcomes.

The theme of a tour of the updated career center, a demonstration of new classroom technologies, and presentations by the senior leadership team was improvement, particularly in student outcomes. Management appears bullish on a gradual recovery in demand despite double-digit new enrollment declines.