Opinions about investing in EDU stock?

Asked 3 years ago

Happy days guys. I wanted to talk about EDU today. It’s a stock that I have previously owned but dumped it as its growth was too slow and I got bored with it. 😉 Since I dumped it, there has been a wonderful drop in its stock price, and it is currently trading at approx 1/3 of its 52 week high? I have spent the last three years working seven days a week in the Chinese online education field before finally saying goodbye to it forever because t is an industry that is constantly looking at enforcing new regulations. During my time working, they introduced new regulations saying children above a certain age can no longer study after 9 pm, Beijing time, and the industry was shaken and teachers in an uproar. What happened? Nothing! All my time slots just got filled with students of different ages, and the classes continued late into the night anyway. Xi Jinpeng has rightly stated recently that online tutoring is causing social problems amongst Chinese children and will look to regulate study in the evenings as well as during vacation times. He is right; I have seen firsthand how Chinese children have no social life and study seven days a week for every hour they can. With this news, the price of EDU has been decimated, and for me, this creates a wonderful opportunity. The industry is expected to grow at about 14% per annum, and the stock is currently on a Black Friday sale, in my opinion. This is not financial advice, so please do your own research, but this is setting off buy signals all over the place in my head. I expect the latest news to be a storm in a teacup, with any potential regulations taking a considerable time to be fully enforced. As always, I chose this stock because I see the upside hugely outweighing the downside. Sure, I can buy tonight’s at $7.63, and it can fall to $5, or it can return over the coming months to $20. Anyway, enough rambling and DYOR, I would love to hear your thoughts.

Andrew Moran

Wednesday, June 30, 2021

Since peaking at around $21, the stock has cratered to as low as $7.2. The problem is that the Chinese government has been cracking down on private tutoring services, and this is bad news for New Oriental Education & Technology Group Inc. (EDU).

This is a risky play because of how much uncertainty there can be when it comes to public policymaking in China.

The beatdown probably is not over, so perhaps if you want to dive back into the stock, you should wait until falls even more.

Plus, if you desire trading Chinese securities, there are plenty of other respectable options to choose from.





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