New Oriental Education & Technology Group (EDU) As Earnings And Guidance Test Its Undervalued Case

New Oriental Education & Technology Group (NYSE: EDU) is back in focus after reporting fourth-quarter and full-year results, issuing fiscal 2027 revenue guidance and outlining fresh shareholder-return plans. The stock closed at $58.58, after a 26.8% one-month share-price gain. Its one-year total shareholder return was 35.0%, while the five-year total shareholder return reached 188.0%. With dividends and buybacks becoming a more prominent part of the return profile, investors must assess whether the shares still offer an attractive balance of risk and reward at this valuation. The most-followed investment narrative considers New Oriental Education 17.3% undervalued. It estimates fair value at $70.80, using a 7.75% discount rate and detailed long-term earnings assumptions. That implies potential upside from the latest close. The thesis points to strong momentum and high year-over-year growth in new non-academic tutoring and AI-powered learning products. Growing demand for enrichment and personalized education, alongside continued prioritization of premium educational services, could support long-term revenue growth, higher retention and improved blended margins as the company scales. However, the valuation depends on compounding revenue, fatter margins and a richer future earnings multiple. Tighter regulation in some segments remains a risk, while tougher competition could challenge both margins and growth expectations. Investors may also consider the referenced opportunity to examine 18 top founder-led companies after EDU’s sharp advance. This commentary is based on historical data and analyst forecasts using an unbiased methodology. It is general in nature, is not financial advice, does not constitute a recommendation to buy or sell securities, and does not consider individual objectives or financial circumstances. It may not reflect the latest price-sensitive company announcements or qualitative information. Simply Wall St has no position in the stocks mentioned.