New Oriental Education & Technology Group (EDU) Posts Strong Results, Is The Valuation Upside Still There?
Why New Oriental Education & Technology Group Stock Is Back on Investors’ Radar
New Oriental Education & Technology Group (EDU) stock is in focus after the company reported stronger fourth quarter and full year 2026 results, along with fresh revenue guidance for fiscal 2027 and new shareholder return plans.
See our latest analysis for New Oriental Education & Technology Group.
The latest earnings, fresh revenue guidance and new shareholder returns have put New Oriental Education & Technology Group back in focus, with a 1 day share price return of 15.34% and a 1 year total shareholder return of 35.01%. The 5 year total shareholder return of 188.00% shows how long term holders have been rewarded even as shorter term price momentum has only recently picked up again.
If strong recent moves in EDU have your attention, it can help to broaden your watchlist with other focused themes. Take a look at 19 top founder-led companies
After a 15.34% single day move and solid long term gains, the key tension for New Oriental Education & Technology Group investors is clear. Is most of the re rating already reflected in the US$58.58 share price, or does valuation still suggest more room to run?
Most Popular Narrative: 17.3% Undervalued
New Oriental Education & Technology Group's most followed valuation narrative puts fair value at $70.80, compared with the latest close at $58.58, which is a sizeable gap for investors to weigh.
Strong momentum and high year-over-year growth in new non-academic tutoring and AI-powered learning products reflects growing consumer demand for enrichment and personalized education, positioning the company to benefit from continued societal prioritization of premium educational services. This should support long-term revenue growth and improve blended margins due to scale and higher retention.
Want to see what sits behind that valuation gap for New Oriental Education & Technology Group? The narrative leans heavily on compounding revenue, higher margins and a richer earnings multiple that assumes investors will pay up for this growth profile. Curious which specific growth and profitability assumptions need to hold for $70.80 to make sense on a discounted basis at a 7.75% hurdle rate? The full breakdown sets out those moving parts in detail.
Result: Fair Value of $70.80 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the bullish narrative around New Oriental Education & Technology Group still hinges on overseas study demand and newer ventures. Any sustained weakness in these areas could challenge the case for a higher earnings multiple.
Find out about the key risks to this New Oriental Education & Technology Group narrative.
Another View on New Oriental Education & Technology Group’s Valuation
The popular story is that New Oriental Education & Technology Group is 17.3% undervalued against a US$70.80 fair value. Yet on a simple earnings yardstick, the picture looks very different. EDU trades on a P/E of 22.2x, which is higher than the US Consumer Services industry at 17.2x and peers at 16x, and also above its own fair ratio of 19.9x. That premium suggests less margin for error if growth or margins fall short. This raises the question of which valuation lens to place more weight on when real money is on the line.
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
With New Oriental Education & Technology Group back in focus, it pays to check the underlying drivers for yourself and consider acting early if you feel confident in the story. To see what investors are optimistic about, take a closer look at the 4 key rewards
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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