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Education Stocks Get Straight 'A's

Keith Wirtz thinks a smart investor ought to be learning about education stocks.

The president and chief investment officer of Fifth Third Asset Management runs the firm's four-star Lifemodel Fund, which gained 9.6 percent during 2007.

"We think that in the late stages of a business cycle, and even in a recession, these are almost counter-cyclical stocks," he told CNBC.

"For any investor that's looking for ideas as we move into an economic slowdown...these are great investments to have."

One of his favorite education stocks is Apollo Group, a provider of higher-education programs for working adults.

"The fundamentals are strong," Wirtz said. "They're going through a restructuring phase in the whole industry, and that's leading to higher margins, and, we think, acceleration of earnings in the next two ore three years."

Another education company on his list is DeVry.

"They're cutting costs," he said. "They're shrinking campuses, and they're starting to focus on higher-margin endeavors like graduate programs as well as online education programs."

Education stocks are not without risks.

"One of the risks for these education stocks is bad debt, when students don't pay their student loans back to these universities," he said. "But we haven't seen enrollment growth really kick in until last year, and that's probably something two or three years on the horizon."

Wirtz owns Apollo through his fund.

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