What happened
China’s largest provider of private educational offerings also introduced one of the most popular Chinese stocks to the market on Wednesday. New Eastern Group for Education and Technology (EDU 9.01%) It saw its shares rise 9%, thanks almost entirely to a set of very encouraging quarterly results.
so what
Well before the market opened on Wednesday, New Oriental Education revealed its third quarter numbers for fiscal 2023. The company’s net revenue rose nearly 23% year-over-year to more than $754 million. More dramatically, the education services provider flipped to a non-GAAP (adjusted) net profit of $95.4 million, or $0.56 per American Depositary Share (ADS), from a loss of roughly that total in the same period last year.
Both headline numbers positively beat analyst estimates. On average, forecasters following the stock were modeling just over $714 million in the top line and just $0.13 per ADS, adjusted net profit.
In its earnings release, New Oriental Education cited growth in its study abroad and test preparation segments as particular catalysts for overall improvements. The company also quoted its president, Michael Yu, as saying that in the quarter, “[W]Continue to make strong progress across all key business areas in an environment conducive to recovery as the pandemic subsides.”
What now
Moreover, the new Eastern teaching provided guidelines indicating that the sun would continue to shine. It is expected to generate revenues between $801.8 million and $822.7 million in the current (fourth) fiscal quarter. Not only is that a minimum of 53% higher than it was in the fourth quarter of fiscal 2022, it’s well above analysts’ median estimate of $661.7 million.
Eric Volkmann has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.