NYSE:EDU is not too expensive for the growth it is showing.

Last update: Jul 9, 2024

Our stock screener has singled out NEW ORIENTAL EDUCATIO-SP ADR (NYSE:EDU) as an attractive growth opportunity. NYSE:EDU is demonstrating remarkable growth potential while maintaining strong financial indicators, making it a reasonably priced option. We'll explore this further.

A Closer Look at Growth for NYSE:EDU

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:EDU was assigned a score of 8 for growth:

EDU shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 720.51%, which is quite impressive.
EDU shows a strong growth in Revenue. In the last year, the Revenue has grown by 51.72%.
EDU is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 76.91% yearly.
Based on estimates for the next years, EDU will show a very strong growth in Revenue. The Revenue will grow by 23.94% on average per year.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Deciphering NYSE:EDU's Valuation Rating

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NYSE:EDU has achieved a 5 out of 10:

64.52% of the companies in the same industry are more expensive than EDU, based on the Enterprise Value to EBITDA ratio.
82.26% of the companies in the same industry are more expensive than EDU, based on the Price/Free Cash Flow ratio.
EDU's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as EDU's earnings are expected to grow with 76.91% in the coming years.

Unpacking NYSE:EDU's Health Rating

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NYSE:EDU has earned a 6 out of 10:

EDU has a debt to FCF ratio of 0.01. This is a very positive value and a sign of high solvency as it would only need 0.01 years to pay back of all of its debts.
The Debt to FCF ratio of EDU (0.01) is better than 87.10% of its industry peers.
EDU has a Debt/Equity ratio of 0.00. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of EDU (0.00) is better than 69.35% of its industry peers.
Looking at the Current ratio, with a value of 1.95, EDU is in the better half of the industry, outperforming 67.74% of the companies in the same industry.
With a decent Quick ratio value of 1.91, EDU is doing good in the industry, outperforming 67.74% of the companies in the same industry.

A Closer Look at Profitability for NYSE:EDU

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:EDU scores a 5 out of 10:

The Return On Assets of EDU (4.33%) is better than 75.81% of its industry peers.
The Return On Equity of EDU (8.04%) is better than 69.35% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.68%, EDU is in the better half of the industry, outperforming 75.81% of the companies in the same industry.
Looking at the Profit Margin, with a value of 7.72%, EDU is in the better half of the industry, outperforming 72.58% of the companies in the same industry.
The Operating Margin of EDU (9.61%) is better than 69.35% of its industry peers.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Check the latest full fundamental report of EDU for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.