What Can We Learn From New Oriental Education & Technology Group Inc. (EDU)’s Valuation Ratios?

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New Oriental Education & Technology Group Inc. (NYSE:EDU) finished Thursday with a subtraction of -$0.33 to close at $36.04, a downside of -0.91 percent. An average of 3,387,280 shares of common stock have been traded in the last five days. There was a fall of -$3.30 in the past week, and it reached a new high 18 times over the past 12 months. The last 20 days have seen an average of 3,115,510 shares traded, while the 50-day average volume stands at 2,831,510.

EDU stock has increased by 33.63% in the last month. The company shares reached their 1-month lowest point of $27.34 on 12/01/22. With the stock rallying to its 52-week high on 12/22/22, shares of the company touched a low of $8.40 and a high of $42.19 in 52 weeks. It has reached a new high 18 times so far this year and achieved 71.62% or $15.04 in price. In spite of this, the price is down -14.58% from the 52-week high.


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Valuation Metrics

New Oriental Education & Technology Group Inc. (EDU) has a trailing price-to-earnings (P/E) ratio of 150.17. The stock’s beta is 0.43. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 2.06, the price-to-book (PB) ratio at 1.60.

Financial Health

The quick ratio of New Oriental Education & Technology Group Inc. for the three months ended August 30 was 2.60, and the current ratio was 2.60, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.01 and a total debt to equity ratio of 0.01 for the quarter ending August 30. New Oriental Education & Technology Group Inc.’s EBITDA margin for the year ending August 30 is -11.36%. Its gross profit as reported stood at $1.35 billion compared to revenue of $3.11 billion.

Earnings Surprise

For the three-month period that ended August 30, New Oriental Education & Technology Group Inc. had $4.65 billion in cash and short-term investments compared to $297.63 million in total debt. The company posted a net income of $334.41 million in the quarter, while revenues were shrunk -23.6%. The analyst consensus anticipated New Oriental Education & Technology Group Inc.’s latest quarter earnings to come in at $0.38 per share, but it turned out to be $0.48, a 26.30% surprise. For the quarter, EBITDA amounted to $77.99 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at New Oriental Education & Technology Group Inc. (EDU) price momentum. RSI 9-day as of the close on 29 December was 55.65%, suggesting the stock is Neutral, with historical volatility in this time frame at 61.84%.

As of today, EDU’s price is $37.92 -8.39% or -$3.30 from its 5-day moving average. EDU is currently trading +25.40% higher than its 20-day SMA and +46.86% higher than its 100-day SMA. However, the stock’s current price level is +51.68% above the SMA50 and +240.00% above the SMA200.

The stochastic %K and %D were 56.21% and 64.90%, respectively, and the average true range (ATR) was 2.85. With the 14-day stochastic at 46.24% and the average true range at 2.62, the RSI (14) stands at 59.78%. The stock has reached -0.61 on the 9-day MACD Oscillator while the 14-day reading was at 1.13.

Analyst Ratings

CLSA upgraded New Oriental Education & Technology Group Inc. (NYSE: EDU) to a a Buy rating in its most recent analyst report. Previously, the stock was rated as an Outperform.

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