If you want a good term that generates controversy, despite the need for it, it is student loans. This has become a growing debt burden on America’s professionals to the point that many college graduates are simply not able to participate in the economy as they might if they weren’t having to make such large monthly payments.

So, what are student loan industry watchers supposed to think when a company like Navient Corp. (NASDAQ: NAVI) issues an earnings warnings that is bad enough to take the stock to a 52-week low?

Navient announced that on Monday that it expects second-quarter 2015 core earnings of about $0.40 diluted earnings per share, and it sees full-year 2015 core earnings of about $1.85 in earnings per share.

Several things were to blame here — aggressive market pricing for private education loan portfolios; net interest income; increased cost of funds; higher risk private education loan borrowers who returned to school during the recession deferred repayment (loans experiencing unfavorable credit trends); and more.

Navient further said:

In addition, loan balances exiting deferment increased to $2.5 billion in 2014, as compared to $1.8 billion in 2013 and $2.1 billion in 2012. For 2015, these figures are projected to decline to $1.7 billion. As a result, the company increased its provision for these loans and now projects a private education loan loss provision of $191 million for the quarter and $575 to $600 million for the year. As of June 30, 2015, the company’s private education loan portfolio totaled $28.1 billion… As a result of the recent performance in its long-term recovery rate on defaulted loans, the company changed its recovery rate assumption on charged-off loans to 21 percent. The company reduced the balance of the receivable for partially charged-off loans by $330 million to reflect this update. Because this item was previously reserved for, this change did not impact the loan loss provision.

So, is all a total write-off story here for Navient? Perhaps not.

There is a potential for upside from a previously written-off source here. Navient said that it has already removed private education loan acquisitions from its guidance, but the company continues to believe that there will be opportunities for the company to acquire loans in 2015 and beyond. Also, Navient said that it continues to see positive credit trends for new college graduates.

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Navient looked bad enough on the day, but things may be worse than they appear just from a big drop. The drop was down 10.5% to $16.42, but this took the stock to a new low in the last year. Its 52-week range is $15.76 to $22.71. Navient also traded some 8.5 million shares on Tuesday, about 4.25 times normal trading volume.

With the stock market hovering so close to 52-week highs, how comforted should investors really be if they are looking at stocks that just joined the 52-week low club?

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