In this episode of Yet Another Value Podcast, host Andrew Walker is joined by Jingshu from Guinea Value to discuss New Oriental Education (ticker: EDU), a Chinese education services firm. They explore the company’s dramatic fall in 2021 following regulatory crackdowns, its surprising rebound, and its resilience in the face of industry headwinds. Jingshu shares rare firsthand insights from his own experience founding a similar business, giving unique context to New Oriental’s position in the market. Topics range from working capital dynamics and regulatory shifts to capital allocation and AI’s impact on education. Tune in for an in-depth look at one of China's most compelling turnaround stories.
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[00:00:00] Andrew introduces podcast and guest
[00:02:16] Jingshu greets and intro begins
[00:02:55] New Oriental company history overview
[00:05:02] Reasons Andrew invited Jingshu
[00:05:32] Jingshu’s personal edu background
[00:09:41] China edu sector decline insights
[00:10:24] Market misunderstanding and tail risks
[00:16:03] Discussion of regulatory risk
[00:22:25] Cash position and asset value
[00:25:43] Livestream business background
[00:27:26] Capital return strategy discussion
[00:33:57] Michael’s conservative cash mindset
[00:38:28] AI disruption and edtech impact
[00:43:19] Challenges of AI competition
[00:46:06] Superstar teacher dynamics
[00:48:44] Andrew closes the episode
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