UPDATE: Brean Capital Starts New Oriental Education (EDU) at Buy

(Updated - July 21, 2016 11:31 AM EDT)

Brean Capital initiated coverage on New Oriental Education (NYSE: EDU) with a Buy rating and a price target of $52. Analyst Fawne Jiang said he expects top and bottom-line growth.

Jiang explained, "EDU is one of the largest educational service providers in China, offering K12 tutorials for all subjects, adult language learning and overseas and domestics test preparations, with nationwide coverage. We are positive on EDU’s top-line and bottom-line growth going forward given 1) consistent execution in K12 (on the back of a two-step strategy to increase its student market share and then flex its pricing power), 2) anticipating margin expansion (based on a stabilized O2O spending, operating leverage from improvements in utilization and stringent cost controls, and plans to strategically begin flexing its pricing power in FY2017), and 3) continued build-on of its brand image and nationwide coverage through disciplined network expansion and investments in O2O/online products and services."

For an analyst ratings summary and ratings history on New Oriental Education click here. For more ratings news on New Oriental Education click here.

Shares of New Oriental Education closed at $44.57 yesterday.

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