New Oriental (EDU) 3Q15 Results Summary
核心内容
New Oriental (EDU) reported its 3Q15 results, showing revenue growth in line with guidance. The company's K12 business demonstrated healthy growth, while overseas test prep enrollments remained weak. The firm's online initiatives are expected to reduce expenses as a percentage of revenue in FY16. The price target (PT) was revised up to US$25 from US$23, implying a fair value based on its expected FY16E net profit growth of 18.3%.
主要观点
- 3Q15 Revenue: US$287.7 million, up 13.1% YoY, in line with the guidance of 10%-14% growth.
- Operating Profit Margin (OPM): 12.5%, down 1.7pcpt YoY, but 2.4pcpt above the estimate.
- Net Profit: US$45.4 million, up 16.6% and 15.9% compared to the estimate and consensus, respectively.
- Enrollment Trends: Total enrollment was flat YoY at 603K students due to late Chinese New Year (CNY), affecting Spring class enrollments.
- K12 Business: Recorded 22% YoY revenue growth, contributing 49.5% of total revenue.
- Overseas Test Prep: Revenue increased by 8% YoY, but enrollment declined by 2% YoY, with ASP up 10% YoY.
- Online Initiatives: Revenue for EDU's online tutoring website, koolearn.com, rose by 39% YoY, with registered users growing over 200% YoY.
- Expansion: EDU opened 20 new centers and closed 11 in 3Q15, with plans to open 5-10 in 4Q15 and 30-35 in FY16, potentially entering 3-4 new cities.
关键信息
- Revenue Breakdown:
- Overseas test prep: US$85 million (29.5% of total revenue)
- K12 tutoring: US$143 million (49.5% of total revenue)
- ASP (Average Selling Price): US$477, up 13% YoY.
- Cost and Expenses:
- Selling and marketing expenses: US$41.6 million (+9.8% YoY)
- G&A expenses: US$84.2 million (+15.8% YoY)
- Net Profit and EPS:
- Net profit: US$45.4 million (-4.3% YoY)
- EPS: US$0.29
- Share Repurchase: EDU repurchased 2.8 million ADS at an average price of US$21.2, totaling US$59.4 million.
- CFO Change: Stephen Yang was promoted to CFO, while Louis Hsieh remained as President and board member.
- Model Revision:
- FY15/16 top line forecast revised up by 0.8%/2.6%, implying 9.5%/15% YoY growth.
- FY15E/16E OPM revised up by 0.8pcpt/0.6pcpt to 14%/14.8%.
- FY15E/16E net profit revised up by 5.3%/5.4%, implying 11% YoY decline in FY15E and 18.3% YoY growth in FY16E.
- Valuation:
- PT revised up to US$25, implying 16x/13.7x FY16E/FY17E P/E.
- EDU is currently trading at 15.8x/13.5x FY16E/FY17E PE, at the lower end of its historical trading range (13x-38x).
- Risks include potential slowdown in enrollment growth, intensified competition, failure in expansion, and policy changes.
财务预测
| Financial Metric |
FY15E |
FY16E |
FY17E |
| Revenue (USD mn) |
1,247.4 |
1,433.9 |
1,625.4 |
| Operating Profit (USD mn) |
174.0 |
212.5 |
247.6 |
| Net Profit (USD mn) |
209.9 |
248.3 |
290.1 |
| Net Profit Margin (%) |
16.8% |
17.3% |
17.9% |
| Operating Margin (%) |
14.0% |
14.8% |
15.2% |
财务比率分析
| Ratio |
2013A |
2014A |
2015E |
2016E |
2017E |
| Gross Margin (%) |
60.0% |
60.3% |
58.3% |
58.4% |
58.5% |
| EBITDA Margin (%) |
16.9% |
21.2% |
15.8% |
16.4% |
16.9% |
| Operating Margin (%) |
12.8% |
17.3% |
12.6% |
13.4% |
14.0% |
| Net Profit Margin (%) |
14.2% |
18.9% |
15.5% |
15.9% |
16.6% |
| FCF Margin (%) |
17.7% |
23.9% |
12.5% |
13.7% |
14.4% |
估值对比
| Company |
Ticker |
Trading Currency |
Last Close |
Mkt Cap (USD mn) |
P/E (FY15) |
P/E (FY16) |
P/E (FY17) |
EV/Sales (FY15) |
EV/Sales (FY16) |
EV/Sales (FY17) |
ROE (FY15) |
ROE (FY16) |
ROE (FY17) |
Jefferies Ratings |
Fiscal Year |
| New Oriental |
EDU US |
USD |
24.68 |
3,893 |
18.6 |
15.8 |
13.5 |
2.3 |
2.0 |
1.8 |
19.6% |
20.0% |
19.2% |
Hold |
May 31 |
| TAL Education |
XRS US |
USD |
36.05 |
2,843 |
36.1 |
28.3 |
21.7 |
5.9 |
4.4 |
3.5 |
28.4% |
28.7% |
28.3% |
Buy |
Feb 28 |
| Tarena |
TEDU US |
USD |
12.52 |
634 |
18.9 |
13.9 |
11.0 |
1.9 |
1.4 |
1.1 |
19.1% |
21.3% |
21.6% |
Buy |
Dec 31 |
| China Distance Edu |
DL US |
USD |
19.30 |
689 |
22.5 |
18.2 |
15.1 |
4.6 |
3.7 |
3.0 |
26.6% |
36.4% |
41.4% |
NC |
Sep 31 |
| XUEDA Edu |
XUE US |
USD |
3.15 |
196 |
17.5 |
10.3 |
n.a. |
(0.0) |
(0.0) |
n.a. |
NC |
Dec 31 |
|
|
|
| Average |
- |
- |
- |
- |
- |
22.7 |
17.3 |
5.3 |
2.9 |
2.3 |
23.4% |
26.6% |
27.6% |
- |
- |
风险因素
- Enrollment Growth: Potential slowdown or faster-than-expected growth.
- Competition: Intensified competition in the education sector.
- Expansion: Failure in expansion efforts.
- Policy Changes: Regulatory changes affecting the business.
财务摘要
| Metric |
2013A |
2014A |
2015E |
2016E |
2017E |
| Revenue (USD mn) |
959.9 |
1,138.9 |
1,247.4 |
1,433.9 |
1,625.4 |
| Gross Profit (USD mn) |
575.7 |
687.2 |
727.2 |
837.6 |
951.4 |
| Operating Profit (USD mn) |
122.6 |
197.6 |
157.0 |
192.5 |
227.6 |
| Net Income (USD mn) |
136.3 |
215.7 |
192.8 |
228.3 |
270.1 |
| Total Assets (USD mn) |
1,353.4 |
1,603.5 |
1,737.8 |
2,055.7 |
2,413.1 |
| Total Liabilities (USD mn) |
496.2 |
577.8 |
622.3 |
691.9 |
759.2 |
| Total Equity (USD mn) |
857.3 |
1,025.8 |
1,115.5 |
1,363.8 |
1,653.9 |
| Net Debt (USD mn) |
-1,114.0 |
-1,114.0 |
-1,114.0 |
-1,114.0 |
-1,114.0 |
| Cash & ST Invest. (USD mn) |
1,114.0 |
1,114.0 |
1,114.0 |
1,114.0 |
1,114.0 |
| Book Value/Share (USD) |
6.50 |
6.50 |
6.50 |
6.50 |
6.50 |
| Return on Avg. Equity (%) |
25.0% |
25.0% |
25.0% |
25.0% |
25.0% |