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E-learning companies look smart even in a down market
Investors have given the e-commerce sector failing grades, but the online-learning niche may be headed for another straight-A semester. Stock in many education companies is hovering near 52-week highs, and analysts are lavishing praise on the small but growing industry. Although investors dismissed the for-profit education industry in the mid-1990s as dull and risk-averse, it has roared back into favor and is enjoying the spotlight as a reliable, recession-proof haven for those who have grown weary of technology stocks' hair-raising volatility. But it's hard to predict how long the online-learning industry's Wall Street honeymoon will last. Although some of the companies predate the popularization of the Internet, they are expanding heavily into Web-based e-commerce, spending lavishly on marketing and leaving themselves exposed to the same variables that have ravaged the broader technology industry.