New Oriental Education: Clear Leader in Rapidly Expanding Market

A New York presenter recommends New Oriental Education and Technology (NYSE: EDU, $119.34) as a Buy. The company has the largest share, the only recognizable brand and the strongest network of learning centers in a fast-growing market for private education services in China. Still, even at 2 million households, EDU has only captured less than 1% of the total opportunity. The Street has focused on a recent drop in margins, but the company is expanding in a much more controlled fashion now. New tutoring services are gaining ground fast. There is $0.5 billion in cash on the balance sheet and no debt.