TAL & EDU: Two Hot Education Stocks In Market

Summary

• TAL closed Tuesday's session at 18.47% higher to US$42.14, while EDU closed 20.84% higher to US$10.96 from the previous close.
• TAL Revenue increased to US$4.5 billion in the fourth quarter ended February 2021.
• The stocks had pulled back after the Chinese government announced new regulatory measures against the country's private education service providers last week.

Stocks of Tal Education Group (NYSE:TAL) and New Oriental Education & Technology Group, Inc. (NYSE:EDU) drew renewed investors' interests on Tuesday. They were among the top movers.

TAL closed Tuesday's session at 18.47% higher to US$42.14, while EDU closed at 20.84% higher to US$10.96 from the previous close.

Tuesday's gains come after they plunged around 40% in the last 30 days.

They were among the most active stocks on May 25.

Some 81 million TAL stocks and 39 million EDU shares were traded during the session.

Let's explore more about these two stocks:

Tal Education Group

Founded in 2003, TAL provides tuition classes to students from preschool to K-12 standards in China. The company is headquartered in Beijing.

The classes are imparted through three frameworks: one-on-one, online, and after school. It has some 6.7 million students from about 100 cities on its roll.

Revenue increased to US$4.5 billion in Q4 ended February, a significant jump from US$3.3 billion a year ago. It incurred a net loss of US$116 million against US$110 million in the prior year.

The company's net cash flow improved from US$651 million to US$3.1 billion during the period.

Source: Pixabay

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New Oriental Education & Technology Group, Inc. (NYSE:EDU)

EDU shed almost 45% in the last 30 days. It was in decline for five consecutive days before Tuesday's forward march. China's largest education service provider has over 1,400 centers in 86 cities and a network of online and offline bookstores. It was founded in 1993.

More than 53 million students are enrolled with the organization. EDU targets students from the same educational levels as TAL – preschool to K-12.

It saw 29% YoY growth in net revenue to US$1.1 billion in the third fiscal quarter ended February. Net income soared 9.9% YoY to US$151.3 million in Q3.

The stocks had pulled back after the Chinese government announced new regulatory measures against private education providers in the country last week. In March, Beijing banned private tuition providers from taking online classes after 9:00 pm and placing ads on state media.

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Furthermore, no foreign curriculum and no tuition classes on the campus are allowed. Analysts say that the government may also place a cap on the maximum fees they can charge from pupils in the coming days that may affect their profit margin.