Citron Research Makes The Case That New Oriental Education (EDU) Is Worth 70% Less

Citron Research issued a cautious report on New Oriental Education and Technology Group (NYSE: EDU) saying at 40x 2008 EPS and 9x sales it is significantly overvalued.

Citron noted that the company, which teaches English to Chinese adults, is seeing a slowdown in business and is seeing increased competition with little barrier to entry.

Furthermore, Citron said a recent sale of competitor Wall Street Institute suggests EDU is worth less than $14.25 per share, or 70% below the current market price.

Link to Citron Research Report on EDU

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