Analyst

Steve

Equity Bottom-Up

China Beststudy Education / Equity Bottom-Up

<ul>
<li>China after-school tutoring remains one of the most attractive and visible sectors in the next 2-3 years time frame. </li>
<li>Even though <a href="https://www.smartkarma.com/entities/new-oriental-education-techn-cc88998e-fe0d-4a03-b544-f3e9836b06a2" target="_blank" data-smartkarma-citation="entities:531:1" rel="noopener">New Oriental Education &amp; Techn (EDU US)</a> had some hiccups in FY3Q24 results, they were mainly due to factors not related to the core after-school tutoring business.</li>
<li>My sector top pick is <a href="https://www.smartkarma.com/entities/china-beststudy-education-group" target="_blank" data-smartkarma-citation="entities:40632:1" rel="noopener">China Beststudy Education Group (3978 HK)</a>, as valuation is lower and growth is higher, though it has a much smaller market cap..</li>
</ul>


China after-school tutoring remains one of the most attractive and visible sectors in the next 2-3 years time frame. 
Even though New Oriental Education &amp; Techn (EDU US) had some hiccups in FY3Q24 results, they were mainly due to factors not related to the core after-school tutoring business.
My sector top pick is China Beststudy Education Group (3978 HK), as valuation is lower and growth is higher, though it has a much smaller market cap..


China After-School Tutoring:  Still In The Early Innings; Prefer China Beststudy Over EDU

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-beststudy-education-group" target="_blank" data-smartkarma-citation="entities:40632:1" rel="noopener">China Beststudy Education Group (3978 HK)</a> is a Chinese K12 tutoring company with the majority of the learning centers in the Greater Bay Area. </li>
<li>The company is trading at 5x forward PE (2024), and I expect earnings to grow &gt;100% in 2024 off of a low base, and &gt;30% in 2025.  </li>
<li>I believe a forward PE of 10x is reasonable and conservative, which is at a discount to the market leader EDU's current 20x.</li>
</ul>



China Beststudy Education Group (3978 HK) is a Chinese K12 tutoring company with the majority of the learning centers in the Greater Bay Area. 
The company is trading at 5x forward PE (2024), and I expect earnings to grow &gt;100% in 2024 off of a low base, and &gt;30% in 2025.  
I believe a forward PE of 10x is reasonable and conservative, which is at a discount to the market leader EDU's current 20x.


China Beststudy Education (3978 HK):  A Darkhorse Stock In The China Tutoring Sector

Smartkarma AI Primers, Smartkarma

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Smartkarma

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New Oriental Education & Techn / Equity Bottom-Up

<ul>
 <li>
Successful Pivot to New Growth Engines: Following the 2021 regulatory overhaul of the K-9 tutoring sector, New Oriental has successfully transitioned its business model. It has established new, rapidly growing revenue streams in live-streaming e-commerce (East Buy), non-academic tutoring, and educational tourism, demonstrating remarkable resilience and strategic agility.</li>
 <li>
Strong Financial Recovery and Outlook: The company has returned to solid profitability and revenue growth, with management guiding for a 14-18% YoY revenue increase in FY27, ahead of consensus estimates. This is driven by the strong performance of its new businesses and continued demand in its traditional overseas test preparation and consulting segments.</li>
 <li>
Dominant Brand and Market Position: New Oriental retains one of the most recognized and trusted brands in the Chinese education sector. This brand equity provides a significant competitive advantage, facilitating customer acquisition for both its established and emerging business lines.</li>
</ul>This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.


  
Successful Pivot to New Growth Engines: Following the 2021 regulatory overhaul of the K-9 tutoring sector, New Oriental has successfully transitioned its business model. It has established new, rapidly growing revenue streams in live-streaming e-commerce (East Buy), non-academic tutoring, and educational tourism, demonstrating remarkable resilience and strategic agility.
  
Strong Financial Recovery and Outlook: The company has returned to solid profitability and revenue growth, with management guiding for a 14-18% YoY revenue increase in FY27, ahead of consensus estimates. This is driven by the strong performance of its new businesses and continued demand in its traditional overseas test preparation and consulting segments.
  
Dominant Brand and Market Position: New Oriental retains one of the most recognized and trusted brands in the Chinese education sector. This brand equity provides a significant competitive advantage, facilitating customer acquisition for both its established and emerging business lines.
This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

Primer: New Oriental Education & Techn (EDU US) - Aug 2026

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>New Oriental Education & Technology Group reported its fourth quarter and full fiscal year 2026 results demonstrating revenue growth across several core and new business segments amid a challenging economic and regulatory environment.</li><li>The company’s total net revenue increased by 23% year-over-year to $1.53 billion in Q4, driven by progress in its core education business, overseas test preparation, adult and university student programs, and new initiatives such as non-academic tutoring and intelligent learning systems.</li><li>Non-GAAP operating income rose 34.7% to $110 million, reflecting improved operational efficiency and margin expansion despite some one-off restructuring costs.</li></ul>

New Oriental Education & Technology Group reported its fourth quarter and full fiscal year 2026 results demonstrating revenue growth across several core and new business segments amid a challenging economic and regulatory environment.The company’s total net revenue increased by 23% year-over-year to $1.53 billion in Q4, driven by progress in its core education business, overseas test preparation, adult and university student programs, and new initiatives such as non-academic tutoring and intelligent learning systems.Non-GAAP operating income rose 34.7% to $110 million, reflecting improved operational efficiency and margin expansion despite some one-off restructuring costs.

New Oriental Education & Technology Group’s $500 Million Capital Return Signals A Bold Reset!

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>New Oriental announced 4QFY26 results: net revenue was up by 23% YoY to US$1.53bn, 4% ahead of the Visible Alpha (VA) consensus estimate thanks to the solid growth of core educational businesses; non-GAAP operating income increased by 35% YoY to US$110mn, beating VA consensus by 7% thanks to the outperformance of revenue and enhanced operating efficiency.</li><li>In FY26, net revenue/non-GAAP operating income grew by 16%/33% YoY to US$5.66/0.74bn.</li><li>Looking into FY27E, management guided net revenue to grow by 14-18% YoY to US$6.45bn-6.68bn, also ahead of VA consensus of US$6.27bn. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

New Oriental announced 4QFY26 results: net revenue was up by 23% YoY to US$1.53bn, 4% ahead of the Visible Alpha (VA) consensus estimate thanks to the solid growth of core educational businesses; non-GAAP operating income increased by 35% YoY to US$110mn, beating VA consensus by 7% thanks to the outperformance of revenue and enhanced operating efficiency.In FY26, net revenue/non-GAAP operating income grew by 16%/33% YoY to US$5.66/0.74bn.Looking into FY27E, management guided net revenue to grow by 14-18% YoY to US$6.45bn-6.68bn, also ahead of VA consensus of US$6.27bn. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

New Oriental (EDU US) - 4QFY26 results beat; expect solid momentum to sustain in FY27E

China

New Oriental Education & Technology Group, Inc. offers educational services. The Company offers foreign language training, test preparation courses for admissions and assessment tests in the United States, the PRC and Commonwealth countries, primary and secondary school education, and other services. New Oriental Education & Technology Group also operates software development.

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New Oriental Education & Techn (EDU US)

China After-School Tutoring: Still In The Early Innings; Prefer China Beststudy Over EDU

China Beststudy Education (3978 HK) is up 15% today on good volume on the back of raised guidance for FY24 by management. The stock has more than...

Steve

China Beststudy Education (3978 HK): A Darkhorse Stock In The China Tutoring Sector

High conviction pick in a very attractive sector with policy tailwind now. Volume starting to pick up indicating more investor interest. Still...

Steve

Primer: New Oriental Education & Techn (EDU US) - Aug 2026

Successful Pivot to New Growth Engines: Following the 2021 regulatory overhaul of the K-9 tutoring sector, New Oriental has successfully...

αSK Primers

New Oriental Education & Technology Group’s $500 Million Capital Return Signals A Bold Reset!

New Oriental Education & Technology Group reported its fourth quarter and full fiscal year 2026 results demonstrating revenue growth across...

Baptista Research

New Oriental (EDU US) - 4QFY26 results beat; expect solid momentum to sustain in FY27E

Looking into FY27E, management guided net revenue to grow by 14-18% YoY to US$6.45bn-6.68bn, also ahead of VA consensus of US$6.27bn.

CMB International

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