New Oriental Education & Technology Group (EDU) Stock Analysis & Winston Score

New Oriental Education & Technology Group is a large Chinese education company. It offers tutoring, test preparation, and language training to students across China, from young children through adults. The company is one of the biggest private education providers in China and owns the well-known "New Oriental" brand.

New Oriental earns money mainly by charging fees for in-person and online classes. It operates hundreds of learning centers across dozens of Chinese cities, and it also runs an e-commerce livestreaming business called "Dongfang Zhenxuan" that sells products like food and books. The company rebuilt its business after China's 2021 regulations banned for-profit tutoring in core school subjects, forcing a major shift away from its original model. The key growth driver is expanding its remaining tutoring services — focused on non-restricted subjects like arts and sports — along with growing its livestreaming revenue, but ongoing regulatory risk from the Chinese government remains the biggest uncertainty for the business.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+19.8% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+50.0% YoY

YoY Growth Rate

EPS growth accelerating

Insider Activity

0.0%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$5.9B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

New Oriental Education & Technology Group is a rare growth stock that's already generating positive cash flow while growing at 20%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

53.7%

Healthy — 53.7% gross margin

Operating Margin

12.7%

Healthy — 12.7% operating margin

ROCE

4.4%

Weak — 4.4% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+2.7%

Nearly flat sales (2.7% YoY)

EPS YoY

-29.2%

Earnings shrinking (-29.2% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

4/8 quarters

Earnings inconsistent quarter-to-quarter

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Cash Flow

Cash Conversion

408%

Turns 408% of profit into real cash

FCF Margin

17.7%

Converts sales into free cash efficiently (17.7%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

Debt / Equity

N/A

Data not available

Interest Cover

100.00x

—

Comfortably covers interest (100.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)

29.4x

no trend

Growth-priced — P/E 29.4

P/E above the market average. People are paying up for expected growth.

P/E vs Forward

+18.0

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (29.4 → 11.4)

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Dividends

Dividend Yield

2.47%

no trend

Moderate income — 2.47% yield

Standard yield zone for stable dividend payers. A meaningful piece of total return.

Dividend Growth

N/A

no trend

Data not available

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