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New Oriental Education & Technology Group's Earnings Beat Last Year's by 22%

By Seth Jayson - Updated Apr 10, 2017 at 1:44PM

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Just the facts, Fool.

New Oriental Education & Technology Group (NYSE: EDU) reported earnings on April 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 28 (Q3), New Oriental Education & Technology Group met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share grew significantly. GAAP earnings per share grew significantly.

Gross margins shrank, operating margins grew, net margins were steady.

Revenue details
New Oriental Education & Technology Group notched revenue of $218.5 million. The five analysts polled by S&P Capital IQ predicted a top line of $216.5 million on the same basis. GAAP reported sales were 25% higher than the prior-year quarter's $174.5 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.22. The three earnings estimates compiled by S&P Capital IQ predicted $0.16 per share. Non-GAAP EPS of $0.22 for Q3 were 22% higher than the prior-year quarter's $0.18 per share. GAAP EPS of $0.18 for Q3 were 29% higher than the prior-year quarter's $0.14 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 58.3%, 50 basis points worse than the prior-year quarter. Operating margin was 10.8%, 130 basis points better than the prior-year quarter. Net margin was 12.8%, much about the same as the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $239.8 million. On the bottom line, the average EPS estimate is $0.14.

Next year's average estimate for revenue is $962.0 million. The average EPS estimate is $0.91.

Investor sentiment
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 715 members out of 856 rating the stock outperform, and 141 members rating it underperform. Among 186 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 128 give New Oriental Education & Technology Group a green thumbs-up, and 58 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on New Oriental Education & Technology Group is outperform, with an average price target of $20.77.

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Stocks Mentioned

New Oriental Education & Technology Group Inc. Stock Quote
New Oriental Education & Technology Group Inc.
EDU
$11.92 (0.93%) $0.11

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