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China Stocks

Bought Some EDU New Oriental

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I don’t know why the stock went down this morning after a good earning report. Anyway guessing stock price’s daily fluctuation is not my job. I did listen to the conference call (script by seekingalpha) and it seems to me Michael and Louis did well, although Michael’s English is not perfect. Some of the growth driver:

1) Elite English, I believe this is more like “business English”, I know in Shanghai there are “WallStreet English”, “Webber English”, etc. Don’t know how New Oriental will do in this new space. But profit margin in this area is better because those customers are not price sensitive.

2) Oversea English Test preparation: I believe things have not slow down because nowadays more and more Chinese high school graduates go overseas for undergraduate education.

They also talked a bit on goverment regulation on “private education sector” and coming lock up expired period.

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