New Oriental Profitability Analysis

EDU -  USA Stock  

USD 1.89  0.03  1.56%

For New Oriental profitability analysis, we use financial ratios and fundamental drivers that measure the ability of New Oriental to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well New Oriental Education utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between New Oriental's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of New Oriental Education over time as well as its relative position and ranking within its peers. Continue to Investing Opportunities.

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New Oriental Return on Sales is comparatively stable at the moment as compared to the past year. New Oriental reported Return on Sales of 0.14 in 2020. Sales per Share is likely to gain to 2.81 in 2021, whereas Price to Sales Ratio is likely to drop 4.65 in 2021. New Oriental Net Loss Income from Discontinued Operations is comparatively stable at the moment as compared to the past year. New Oriental reported Net Loss Income from Discontinued Operations of 468,050 in 2020. Income Tax Expense is likely to gain to about 166.7 M in 2021, whereas Accumulated Other Comprehensive Income is likely to drop (27.2 M) in 2021.

New Oriental Revenues

4.44 BillionShare
The market value of New Oriental Education is measured differently than its book value, which is the value of New Oriental that is recorded on the company's balance sheet. Investors also form their own opinion of New Oriental's value that differs from its market value or its book value, called intrinsic value, which is New Oriental's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because New Oriental's market value can be influenced by many factors that don't directly affect New Oriental Education underlying business (such as pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between New Oriental's value and its price as these two are different measures arrived at by different means. Investors typically determine New Oriental value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, New Oriental's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

New Oriental Education Current Valuation vs. Z Score Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining New Oriental's current stock value. Our valuation model uses many indicators to compare New Oriental value to that of its competitors to determine the firm's financial worth.
New Oriental Education is rated # 2 in z score category among related companies. It is rated as one of the top companies in current valuation category among related companies reporting about  5,781,250,000  of Current Valuation per Z Score.

New Oriental Current Valuation vs. Z Score

Z-Score is a simple linear, multi-factor model that measures the financial health and economic stability of a company. The score is used to predict the probability of a firm going into bankruptcy within next 24 months or two fiscal years from the day stated on the accounting statements used to calculate it. The model uses five fundamental business ratios that are weighted according to algorithm of Professor Edward Altman who developed it in the late 1960s at New York University..
New Oriental 
Z Score 
 = 
Sum Of  
 
5 Factors 
1.6
To calculate Z-Score one would need to know current working capital of the company, its total assets, and liabilities, amount of latest retained earnings as well as earnings before interest and tax. Z-Score can be used to compare the odds of bankruptcy of companies in a similar line of business or firms operating in the same industry. Companies with Z-Scores above 3.1 are generally considered to be stable and healthy with a low probability of bankruptcy. Scores that fall between 1.8 and 3.1 lie in a so-called 'grey area' with scores of less than 1, indicating the high probability of distress. Z Score is used widely by financial auditors, accountants, money managers, loan processers, wealth advisers, as well as day traders. In the last 25 years, many financial models that utilize z score has been proved to be successful as a predictor of corporate bankruptcy.
Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.
New Oriental 
Enterprise Value 
 = 
Market Cap + Debt 
-  
Cash 
9.25 B
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.

New Oriental Current Valuation vs Competition

New Oriental Education is rated as one of the top companies in current valuation category among related companies. After adjusting for long-term liabilities, total market size of Education & Training Services industry is currently estimated at about 8.79 Billion. New Oriental totals roughly 9.25 Billion in current valuation claiming about 105% of equities under Education & Training Services industry.

New Oriental Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in New Oriental, profitability is also one of the essential criteria for including it into their portfolios because, without profit, New Oriental will eventually generate negative long term returns. The profitability progress is the general direction of New Oriental's change in net profit over the period of time. It can combine multiple indicators of New Oriental, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for 2021
Accumulated Other Comprehensive Income-26.5 M-27.2 M
Consolidated Income408.1 M339.9 M
Net Income475.3 M379.1 M
Net Income Common Stock475.3 M379.1 M
Net Loss Income from Discontinued Operations468.1 K688.3 K
Net Income to Non Controlling Interests-52.6 M-54 M
Operating Income458.9 M363.5 M
Income Tax Expense154.5 M166.7 M
New Oriental Education Technology Group Inc. provides private educational services under the New Oriental brand in the Peoples Republic of China. The company was founded in 1993 and is headquartered in Beijing, the Peoples Republic of China. New Oriental operates under Education Training Services classification in the United States and is traded on New York Stock Exchange. It employs 69438 people.

New Oriental Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on New Oriental. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of New Oriental position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the New Oriental's important profitability drivers and their relationship over time.

New Oriental Profitability Trends

New Oriental profitability trend refers to the progression of profit or loss within a business. An upward trend means that New Oriental's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is New Oriental's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

New Oriental Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between New Oriental different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards New Oriental in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down New Oriental's future profitability.

Use New Oriental in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if New Oriental position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in New Oriental will appreciate offsetting losses from the drop in the long position's value.

New Oriental Pair Trading

New Oriental Education Pair Trading Analysis

Correlation analysis and pair trading evaluation for New Oriental and Hailiang Edu Grp. Pair trading can be used as a hedging technique within a particular sector or industry or even over random equities to generate better risk-adjusted return
Run Pair Correlation  

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Continue to Investing Opportunities. Note that the New Oriental Education information on this page should be used as a complementary analysis to other New Oriental's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Stock Screener module to find equities using custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

Complementary Tools for New Oriental Stock analysis

When running New Oriental Education price analysis, check to measure New Oriental's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy New Oriental is operating at the current time. Most of New Oriental's value examination focuses on studying past and present price action to predict the probability of New Oriental's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move New Oriental's price. Additionally, you may evaluate how the addition of New Oriental to your portfolios can decrease your overall portfolio volatility.
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To fully project New Oriental's future profitability" href="/future-stock-price/EDU">future profitability, investors should examine all historical financial statements" href="/financial-statements/EDU">financial statements. These statements provide investors with a comprehensive snapshot of the financial position" href="/financial-statements/EDU">financial position of New Oriental Education at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements" href="/financial-statements/EDU">financial statements. These documents include New Oriental's income statement, its balance sheet, and the statement of cash flows.
Potential New Oriental investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although New Oriental investors may work on each financial statement separately, they are all related. The changes in New Oriental's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on New Oriental's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.