Yamato: NEW ORIENTAL-S (09901) profit growth visibility clearer, target price raised to 57 Hong Kong dollars.

Yamato Securities published a research report stating that NEW ORIENTAL-S (09901) outperformed market expectations in the second quarter of the 2026 fiscal year, mainly due to the improvement in its education business profitability and the contribution from EAST BUY. Due to stronger-than-expected growth in K12 and overseas study business revenue, the company raised its revenue growth guidance for the 2026 fiscal year from 5%-10% to 8%-12%. The firm believes that with the promotion of efficiency improvement and revenue contribution from EAST BUY, the company's profit growth visibility is clearer. Based on the upward revision of profit forecast for EAST BUY, the firm raised its earnings per share forecast for New Oriental for the years 2027 to 2028 by 0.4% to 1.4%, reiterating a "buy" rating with a target price raised from HK$53 to HK$57.