Oppenheimer Has Outperform On New Oriental Education & Technology Group (EDU)

Oppenheimer & Co. has an Outperform rating and $109 price target on shares of New Oriental Education & Technology Group EDU. In a note to clients, Oppenheimer writes, "EDU reported F2Q11 GAAP EPS of $0.05 vs our -$0.01 estimate and consensus of $0.02. Strong operational performance added $0.02 EPS upside and below-the-line items contributed the remainder. F2Q's total revenue of $95.7M (+56.3% y/y) significantly exceeded our $84.3M estimate and $82.6-85.7M guidance. Revenue was mainly driven by 32.2% enrollment growth to 405.8K (vs our 16.6% estimate) and strong ASP growth. However, due to heavy investment spending, EDU still incurred operating loss of $2.1M (vs our -$2.9M estimate) and lower y/y margins. It guided F3Q11 revenue of $116.8-121.3M (+31-36% y/y), which brackets our $119.0M estimate and $117.1M consensus. EDU will host a conference call today at 8am ET: +1-617-614-3523 begin_of_the_skype_highlighting              +1-617-614-3523      end_of_the_skype_highlighting. We'll update our model/PT after the call." Shares of EDU lost 93 cents on Friday to close at $107.71 on Friday.