Why a Nearly $500 Million Bet on New Oriental Signals Conviction Amid a 13% Slide
Key Points
Hong Kong-based First Beijing Investment bought 2.23 million shares of EDU in the third quarter.
The value of the fund's EDU position went up $112.15 million during the quarter ended September 30.
As of quarter-end, First Beijing held about 9.35 million EDU shares valued at $496.02 million, making it the fund's third-largest holding.
- These 10 stocks could mint the next wave of millionaires ›
Hong Kong-based First Beijing Investment added 2.23 million shares of New Oriental Education & Technology Group (NYSE:EDU), increasing its position by $112.15 million during the quarter ended September 30, according to an SEC filing published November 14.
What Happened
First Beijing Investment Ltd disclosed in a recent SEC filing dated November 14, that it increased its stake in New Oriental Education & Technology Group (NYSE:EDU) by 2.23 million shares. The post-transaction position totaled 9.35 million shares with a reported market value of $496.02 million as of September 30. EDU now comprises 19.15% of the fund’s U.S. equity portfolio.
What Else to Know
Top holdings after the filing:
- NYSE:YMM: $890.33 million (34.38% of AUM)
- NASDAQ:PDD: $815.32 million (31.48% of AUM)
- NYSE:EDU: $496.02 million (19.15% of AUM)
- NASDAQ:ATAT: $213.09 million (8.23% of AUM)
- NYSE:RLX: $165.33 million (6.38% of AUM)
As of Thursday, EDU shares were priced at $55.03, down 13% over the past year and solidly underperforming the S&P 500, which is instead up about 16%.
Company Overview
| Metric | Value |
|---|---|
| Price (as of Thursday) | $55.03 |
| Market Capitalization | $9.17 billion |
| Revenue (TTM) | $4.99 billion |
| Net Income (TTM) | $367.00 million |
Company Snapshot
- New Oriental Education & Technology offers private educational services, including K-12 after-school tutoring, test preparation, language training, and online education programs.
- The company generates revenue through a combination of in-person and online course fees, educational materials, and consulting services related to overseas study.
- It targets students in China seeking academic advancement, language proficiency, and international education opportunities.
New Oriental Education & Technology Group operates an extensive network of private education services in China, offering programs through physical schools, learning centers, and digital platforms. The company leverages a diversified portfolio of educational offerings and a strong brand presence to maintain its competitive position in the evolving Chinese education market. Its scale and comprehensive service suite support sustained growth and adaptability amid regulatory and market changes.
Foolish Take
By pushing its New Oriental stake to roughly $496 million, this investor has made education a key component of its China exposure, right alongside logistics and consumer platforms. That’s a deliberate choice after a bruising few years for the industry.
Operationally, New Oriental continues to do the work. Fiscal first-quarter revenue climbed 6.1% year over year to $1.52 billion, while operating income rose to $310.8 million. Non-GAAP operating income grew even faster, up 11.3% to $335.5 million, helped by tighter cost discipline and a 100-basis-point expansion in non-GAAP operating margin. Cash generation remains solid too, with nearly $192 million in operating cash flow for the quarter and more than $1.28 billion in cash on the balance sheet.
The tension, however, is on the bottom line. Net income slipped slightly (2%) year over year, and guidance implies modest, not explosive, growth ahead. That’s likely why the stock has lagged despite fundamentals holding up. Nevertheless, when a position grows to nearly one-fifth of a portfolio, it signals belief that the market is underpricing resilience, not growth hype.
Glossary
Position: The total amount of a particular security held by an investor or fund.
Quarter ended: The last day of a three-month financial reporting period.
Reportable U.S. equity assets: U.S. stocks that a fund must disclose in regulatory filings.
Post-trade stake: The total number of shares held after a transaction is completed.
Holding: A specific investment owned within a portfolio or fund.
AUM (Assets Under Management): The total market value of assets a fund or manager oversees.
13F assets: Securities reported by institutional investment managers in quarterly SEC Form 13F filings.
TTM: The 12-month period ending with the most recent quarterly report.
Market changes: Shifts in economic or regulatory conditions affecting investment performance.
Fund: An investment vehicle pooling money from multiple investors to buy securities.
Where to invest $1,000 right now
When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 974%* — a market-crushing outperformance compared to 193% for the S&P 500.
They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.
See the stocks »
*Stock Advisor returns as of January 1, 2026.
Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
