Beijing, China – TAL Education Group, a leading education company listed on the New York Stock Exchange, has recently received a Buy rating. This comes after the company’s announcement of its Q4 FY 2024 results and updates on policies affecting China’s education sector.

The company’s growth outlook remains promising, particularly in its learning services business and learning content solutions business. TAL Education has been rapidly expanding its network of learning centers and experiencing high demand for its learning devices. Despite this positive trend, the company’s valuations have not fully reflected its growth potential, leading to the decision to rate TAL as a Buy.

One of the key drivers of growth for TAL Education is its learning services business, which accounted for 71% of the company’s full-year FY 2024 revenue. The company’s expansion of offline learning centers is expected to significantly increase in the coming fiscal year, as indicated by research reports and management commentary.

Recent reports from Zheshang Securities and Citigroup have highlighted TAL Education’s successful offline expansion and strong demand for its services. In addition, the company’s focus on expanding its learning center network has been a key factor in its revenue growth, with revenue beating consensus estimates in Q4 FY 2024.

In terms of learning content solutions, TAL Education’s AI-driven learning devices, such as the xPad, have been a major contributor to revenue growth. The popularity of these devices has been evident in their high demand and positive user feedback. With an estimated 450,000 units shipped in 2023, TAL’s market share in the learning device market is expected to continue growing in the coming years.

While the company’s growth prospects appear favorable, there are potential risks to consider. Factors such as aggressive expansion of learning centers or competitive pressures on its learning devices could impact TAL Education’s performance. Despite these challenges, the company’s overall outlook remains positive, with strong revenue and earnings growth forecasts for the coming years.

In conclusion, TAL Education presents an opportunity for investors looking for growth potential in the education sector. With attractive valuation multiples and a solid track record of performance, the company is well-positioned to capitalize on the increasing demand for educational services in China and beyond.