Hayden Capital, an investment management firm, released its fourth-quarter 2025 investment letter. A copy of the letter can be downloaded here. 2025 proved how unpredictable markets can be in the short term. Markets displayed broad strength, highlighting their resilience. U.S. equities saw double-digit gains, while international markets performed even better. Remarkably, international stocks outpaced their U.S. counterparts for the first time since 2017. The firm had a productive 2025, especially as invest ...

Core Insights - New Oriental Education & Technology Group reported strong fiscal Q2 2026 results, highlighting significant profit growth, improved margins, and successful new initiatives alongside steady performance in its core education business [4] Financial Performance - Total net revenue increased by 14.7% year-over-year to $1.19 billion [5] - Non-GAAP operating income more than tripled, rising 206.9% to $89.1 million, while non-GAAP net income increased by 68.6% to $72.9 million [5][3] - On a GAAP basis, operating income rose 264.4% to $66.3 million, and net income attributable to New Oriental increased by 42.3% to $45.5 million [2] Margin Expansion - The non-GAAP operating margin expanded by 470 basis points, with approximately 300 basis points of margin expansion attributed to businesses excluding East Buy [1] - The company's focus on operational efficiency, cost control, and better utilization contributed to this margin improvement [1][3] Cost Management - Operating costs totaled $1,125.1 million, up 10.4% year-over-year, with cost of revenues increasing by 11.8% to $556.9 million [6] - Selling and marketing expenses decreased by 1.1% to $194.0 million, while general and administrative expenses rose by 15.2% to $374.3 million [6] Business Highlights - K-12 educational business and high school tutoring showed accelerated revenue growth compared to the previous quarter [8] - The company shifted its strategy to slow learning center expansion to about 10%, focusing more on product and service quality, resulting in higher student retention rates [8] International and New Initiatives - Overseas test preparation revenue increased by 4% year-over-year, while the adults and university students business grew by 13% [10] - New initiatives in non-academic tutoring and intelligent learning systems saw a revenue growth of 22% year-over-year [11] Shareholder Returns and Guidance - Management raised FY26 revenue guidance to $5.29–$5.49 billion, reflecting an 8%–12% year-over-year growth [5][16] - The company announced a dividend of $0.12 per common share and has a $300 million share repurchase authorization, with approximately $86.3 million utilized so far [17]

Company Overview - New Oriental Education & Technology Group operates a wide range of private education services in China, including K-12 after-school tutoring, test preparation, language training, and online education programs [5][8] - The company reported a market capitalization of $9.17 billion and a revenue of $4.99 billion for the trailing twelve months (TTM) [4] - Net income for the TTM was $367 million, indicating a slight year-over-year decline of 2% [4][10] Financial Performance - For the fiscal first quarter, revenue increased by 6.1% year-over-year to $1.52 billion, while operating income rose to $310.8 million [9] - Non-GAAP operating income grew by 11.3% to $335.5 million, supported by improved cost discipline and a 100-basis-point expansion in non-GAAP operating margin [9] - The company generated nearly $192 million in operating cash flow for the quarter and maintained over $1.28 billion in cash on its balance sheet [9] Investment Activity - First Beijing Investment Ltd increased its stake in New Oriental by 2.23 million shares, bringing its total position to 9.35 million shares valued at $496.02 million as of September 30 [2][6] - New Oriental now represents 19.15% of First Beijing Investment's U.S. equity portfolio, indicating a significant commitment to the education sector [2][6] Market Context - As of the latest data, New Oriental shares were priced at $55.03, reflecting a 13% decline over the past year, contrasting with the S&P 500's increase of approximately 16% [3] - The investor's decision to increase its stake in New Oriental suggests a belief that the market is undervaluing the company's resilience despite the challenges faced by the education sector in recent years [6][10]

Company Overview - New Oriental Education & Technology Group is a leading provider of private education services in China, operating a vast network of schools and learning centers, offering a diversified portfolio including language training, test preparation, and online education [5][8] - As of the latest report, the company's market capitalization is $9.3 billion, with a revenue of $5 billion and a net income of $367 million for the trailing twelve months [4] Recent Developments - Serenity Capital Management increased its stake in New Oriental Education & Technology Group by approximately $21.6 million, acquiring 411,380 additional shares during the third quarter, bringing its total holdings to 656,878 shares valued at $34.9 million as of September 30 [2][3] - The fund's investment now represents 8.8% of its reportable assets under management, making New Oriental its fifth-largest holding [3][7] Financial Performance - The company's first-quarter fiscal 2026 revenue rose 6.1% year over year to $1.52 billion, while operating income increased by 6% to $311 million, with a non-GAAP operating margin improvement to 22% [10] - The company ended the quarter with over $1.2 billion in cash and plans to return at least 50% of annual net income to shareholders through dividends and buybacks starting this fiscal year [11] Market Position and Strategy - Following regulatory changes in China's education sector, New Oriental has shifted its focus towards adult education, overseas test preparation, and consulting services, adapting its business model to ensure sustainability and profitability [9][10] - The company is positioned as a scaled, profitable survivor in a challenging market, indicating potential for future growth from a more stable base [12]

Core Points - Visionary Holdings Inc. received a notification from Nasdaq regarding non-compliance with Listing Rule 5250(c)(1) due to a delay in filing its Annual Report on Form 20-F for the fiscal year ended March 31, 2025 [1] - The notification does not have an immediate effect on the listing or trading of the Company's shares, and the Company has 60 days to submit a compliance plan [2] - Visionary is actively working with its independent auditor to complete the audit process and file the Form 20-F as soon as possible [3] Company Overview - Visionary Holdings Inc. is a private education service provider based in Markham, Ontario, Canada, operating in both private and public education sectors [4]

Core Points - Lixiang Education Holding Co., Ltd. has regained compliance with Nasdaq's minimum market value of publicly held shares (MVPHS) requirement [1][2] - The company was previously notified on August 29, 2024, about its failure to maintain a MVPHS of $5,000,000 over 30 consecutive business days [2] - Nasdaq confirmed that Lixiang's MVPHS has been $5,000,000 or greater for the last 16 consecutive business days from February 4 to February 25, 2025 [2] Company Overview - Lixiang Education Holding Co., Ltd. is a private education service provider based in Lishui City, China, focusing on the healthy development of students [3] - The company's educational philosophy aims to establish a solid foundation for students' lifelong advancement and happiness [3]