Citi Upgrades New Oriental Education & Technology Group Inc. (EDU) to ‘Buy’ with $50 Price Target

New Oriental Education & Technology Group Inc. (NYSE:EDU) is included in our list of the 10 Most Undervalued Foreign Stocks to Buy According to Analysts.

Citi Upgrades New Oriental Education & Technology Group Inc. (EDU) to ‘Buy’ with $50 Price Target

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On June 27, 2025, Citi upgraded its rating on New Oriental Education & Technology Group Inc. (NYSE:EDU) from ‘Neutral’ to ‘Buy’ rating, while reducing its price target from $77 to $50. The analyst cited strong domestic growth potential as the reason for the upgrade.

Furthermore, Citi projected upside potential for New Oriental Education & Technology Group Inc. (NYSE:EDU) due to the expansion of its high-margin segments, K9 and Senior High. These segments, expanding at 35% and 11% annually, are expected to grow from 45% to 55% of revenue by FY26.

Meanwhile, the company’s cost discipline, particularly rent reductions and controlled hiring, is driving structural margin expansion. According to analysts’ projections, a 1% revenue shift to domestic operations results in an 8-10 basis-point increase in New Oriental Education & Technology Group Inc. (NYSE:EDU)’s margins. With a low forward P/E ratio and a $4.7 billion net cash reserve, there is strong room for capital gains, the analyst notes.

New Oriental Education & Technology Group Inc. (NYSE:EDU), a China-based educational services provider, offers test preparation, tutoring, online learning, and overseas study consulting. It remains on our list of the most undervalued stocks.

While we acknowledge the potential of EDU to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than EDU and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.