New Oriental Shares Eyes a Bright Future Despite Rough Quarter

Guotai Haitong keeps its positive stance on New Oriental Education & Technology Group, setting a target price of HK$52. 26 even as the stock slipped to HK$41. 96 last week. The general market mood leans toward a “Strong Buy” consensus, with analysts averaging a target of €6. 23 for the company’s shares. In its most recent quarterly report, ending May 31, New Oriental earned HK$1. 24 billion in revenue and a net profit of HK$7. 1 million. Last year, the same period saw revenue of HK$1. 14 billion but a much higher profit of HK$26. 97 million, indicating a sharp drop in earnings despite higher sales.The downgrade of profits raises questions about cost control and market saturation, yet the rising revenue suggests demand for education services remains steady. Investors watching the stock should weigh the potential for recovery against the risk of continued profit erosion, especially in a competitive industry. Analysts emphasize that future performance will hinge on how quickly the company can convert increased revenue into sustainable earnings. Overall, the outlook remains cautiously optimistic, with expectations that New Oriental can regain its profitability while maintaining growth momentum.