Shares of New Oriental (EDU, Financial) fell approximately 9.8% in pre-market trading to $71.77. This decline followed a report from Macquarie, which adjusted its forecast for New Oriental's non-GAAP net profit for fiscal years 2025 to 2027 downward by 11.6% to 13.3%. The revision is based on lowered revenue projections and operating surplus expectations under non-GAAP measures.
Macquarie also revised its target price for New Oriental's H shares from HKD 71 to HKD 63.1, maintaining a projected price-to-earnings ratio of 25 times for fiscal year 2025. Despite the downgrades, the investment rating remains “Outperform.” The firm anticipates that non-academic K9 business will remain robust, while growth in overseas exam preparation could slow down in the first quarter of fiscal year 2025.
