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Pearson plc (LSE:PSON) is getting pounded today on the London Exchange following issuance of its January Trading Report. Folks, it was not good news. Pearson shares closed yesterday at 1311.00 on the London Exchange. It’s share price is currently at 1192.00, down 9.08%. When a company has a market cap of £9.65 billion, that kind of hit is going to create quite a bruise. When you consider that Pearson carries .61% of the weight of the FTSE 100, the bruise has already spread to the index, dragging it from near record heights earlier this week to 6774, it’s lowest point since 14 January.
Pearson refers to itself as “The world’s leading learning company.” It would be difficult to argue the point. However, its position is under attack. The most insidious challenge is coming from the U.S. government’s attempt to foist the Common Core curriculum on all schools in every state. Pay attention. This point is clearly recognized in the report, but nary another news service has either discussed the Common Core challenge.
Please excuse me, all bleeding heart liberals who might be reading this, but the American people, who, once they know what the Common Core curriculum is all about, do not want it. Neither do the majority of teachers. More than a dozen U.S. states are now bucking up and telling the Obama administration that they will not implement the curriculum, which abandons all educational fundamentals and values in favor of thirteen years of “let’s all be nice.”
Pearson CEO, John Fallon, said that, “Our trading and financial performance has been weaker than expected, particularly in North America.” More specifically, he pointed out that “Our North American education business faced a tough trading environment throughout 2013, driven by state budget pressures and the transition to the Common Core (affecting our School business).”
Although the report cited some very strong, positive accomplishments and trend, particularly in emerging markets and it professional education publishing, the North American news has obviously put a scare into nervous investors. The last time PSON was at this price was 03 July 2013, so I agree that the situation is a bit unsettling. But so was Chicken Little’s announcement. We might need to recall that, despite his warning, the sky is still up there.
Given the time and financial consequences of its ongoing internal restructuring process, there needs to be a modicum of patience whilst waiting for the full effect to be reflected in the company’s performance to be forthcoming in 2014.
Everything about Common Core is ugly. Personally, if I had school-age children, I would, if necessary, relocate to keep them from its influence. I have long seen the danger of it on a state and national level. Now I can see its potential impact on the companies like Pearson and on both the U.S. and global economy.
I understand that it’s business. But Common Core is personal on many levels. I take offense at it being taught in our schools and I take offense at its effect on the economy. Before I go to sleep tonight, I’m going to kneel by the bed and pray that this will not be the final chapter for Pearson. Then in the morning, I think that I shall buy a few shares. Whilst this story has come to an end, Pearson’s story will not.
