Value
8.9/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.9 |
| P/S | 9.1 |
| EV/EBITDA | 7.4 |
| Fwd P/E | 9.4 |
| Analyst target | 9.0 |
- ▸Forward P/E: 9.4x
- ▸Attractively valued
TAL · Why this verdict
Why TAL Education (TAL) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score7.1/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
A moat score of 8.4 out of 10, a perfect Piotroski F-Score of 9 out of 9, and strong net margin of 18% characterize TAL as a high-quality compounder with genuine competitive advantages in the Chinese education market. Quality breakdown | Piotroski F-Score remains at 8 or 9 and net margin stays above 15% over the next four reported periods, confirming quality is structural. | →Stable |
| CounterChinese education companies face ongoing regulatory risk from government policy changes; the quality profile reflects current conditions but can be disrupted overnight by policy action as occurred in 2021. | ||
TAL has beaten consensus EPS estimates in all four of the last four quarters with an average surprise of 145%, including beats of 229%, 186%, 113%, and 49%, demonstrating that the business is dramatically outperforming analyst expectations following its business model transition. Earnings | The beat streak extends to at least 3 of the next 4 quarters, with average EPS surprise remaining above 50%. | →Stable |
| CounterMassive beat percentages against very small absolute EPS estimates (the most recent beat was $0.45 versus an estimate of $0.16) reflect low analyst baseline confidence rather than proven earnings power. | ||
Revenue is growing at 32% year-over-year, placing TAL among the top performers in the education and training services sector and ranking it as an industry growth leader in peer comparison. Growth breakdown | Revenue growth remains above 20% in at least 3 of the next 4 reported quarters, confirming the growth is structural and not a one-year base-effect recovery. | →Stable |
| CounterChinese education sector revenue growth following regulatory disruption is substantially a recovery to prior levels rather than genuine new growth; the high percentage may reflect an artificially depressed comparison base. | ||
A death cross with price below all moving averages, RSI at 36, a bearish MACD, and an elevated put-to-call ratio of 8.83 indicate that the technical picture is deeply negative despite the strong fundamental case. V9 | The death cross resolves within 9 months with price recovering above the 200-day moving average and RSI rising above 45. | →Stable |
| CounterRising on-balance volume despite price weakness and an asymmetry ratio of 7.5 (the highest in the list) suggest that the downtrend is a price-discovery dislocation rather than a deteriorating business. | ||
A moat score of 8.4 out of 10, a perfect Piotroski F-Score of 9 out of 9, and strong net margin of 18% characterize TAL as a high-quality compounder with genuine competitive advantages in the Chinese education market.
→StableQuality breakdown
- Expectation
- Piotroski F-Score remains at 8 or 9 and net margin stays above 15% over the next four reported periods, confirming quality is structural.
CounterChinese education companies face ongoing regulatory risk from government policy changes; the quality profile reflects current conditions but can be disrupted overnight by policy action as occurred in 2021.
TAL has beaten consensus EPS estimates in all four of the last four quarters with an average surprise of 145%, including beats of 229%, 186%, 113%, and 49%, demonstrating that the business is dramatically outperforming analyst expectations following its business model transition.
→StableEarnings
- Expectation
- The beat streak extends to at least 3 of the next 4 quarters, with average EPS surprise remaining above 50%.
CounterMassive beat percentages against very small absolute EPS estimates (the most recent beat was $0.45 versus an estimate of $0.16) reflect low analyst baseline confidence rather than proven earnings power.
Revenue is growing at 32% year-over-year, placing TAL among the top performers in the education and training services sector and ranking it as an industry growth leader in peer comparison.
→StableGrowth breakdown
- Expectation
- Revenue growth remains above 20% in at least 3 of the next 4 reported quarters, confirming the growth is structural and not a one-year base-effect recovery.
CounterChinese education sector revenue growth following regulatory disruption is substantially a recovery to prior levels rather than genuine new growth; the high percentage may reflect an artificially depressed comparison base.
A death cross with price below all moving averages, RSI at 36, a bearish MACD, and an elevated put-to-call ratio of 8.83 indicate that the technical picture is deeply negative despite the strong fundamental case.
→StableV9
- Expectation
- The death cross resolves within 9 months with price recovering above the 200-day moving average and RSI rising above 45.
CounterRising on-balance volume despite price weakness and an asymmetry ratio of 7.5 (the highest in the list) suggest that the downtrend is a price-discovery dislocation rather than a deteriorating business.
TrendMatrix Research · core thesis
Engine thesis — one sentence
TAL Education Group has delivered four consecutive earnings beats averaging 145% upside surprise, shows 32% revenue growth, and analysts see 68% price upside from the current $9.32, but a death cross with price below all moving averages and a confirmed downtrend demand patience before the fundamental case can be captured.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.7 |
| ROA | 2.0 |
| Gross margin | 7.1 |
| Op margin | 3.6 |
| Net margin | 8.8 |
| Current ratio | 7.5 |
| FCF quality | 5.8 |
| Moat | 8.4 |
| Piotroski F | 10.0 |
- ▸Strong margins: 18%
- ▸Earnings quality warning: 77% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
- ▸Strong growth: 32% YoY
Momentum
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 8.5 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 0.9 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -1.8%/30d — confirmed downtrend
Sentiment
8.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 8.9 |
| Price target | 9.7 |
| erm sentiment | 4.8 |
- ▸Analyst upside: 59%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Insider selling (low materiality) — $868,480 (0.016% of mkt cap)
Peer rank
5.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.3 |
| quality rank | 6.7 |
| growth rank | 9.4 |
- ▸Attractive P/E vs peers
- ▸Industry growth leader
Technical
2.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.9 |
| support resistance | 2.2 |
| 52w position | 4.7 |
Risk (lower is worse)
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.0 |
| days to cover | 4.5 |
| volatility | 3.8 |
| put call | 10.0 |
| implied vol | 2.5 |
| beta | 10.0 |
| debt equity | 9.6 |
- ▸High IV: 65%
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (8)
- MOMENTUM:5.6>=5.5
- ASYMMETRY:4.5>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- DEATH_CROSS:momentum=5.6>=5.0 recovering
Reward-to-Risk
4.54
Upside
+43.0%
Downside
9.5%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 60
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:5.6>=5.5. Top dim: Growth at 10.0; weakest: Technical at 2.6. No conviction either direction.
The strongest dimensions are Growth at 10.0, Value at 8.9, and Sentiment at 8.0; the weakest are Technical at 2.6, Insider at 5.0, and Peer rank at 5.6. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 4.54 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Extraordinary Earnings Beat Streak
Trip ifEPS surprise falls below 0% in at least 2 of the next 4 quarterly reports, breaking the extraordinary beat cadence.
- P2Revenue Growth 32 Percent
Trip ifYear-over-year revenue growth falls below 15% in at least 2 of the next 4 reported quarters, indicating growth is decelerating significantly from the current 32% pace.
- P3Wide Economic Moat Quality Profile
Trip ifPiotroski F-Score drops below 7 in any reported period, indicating deterioration of more than 2 points from the current perfect score of 9.
- P4Death Cross Confirmed Downtrend
Trip ifPrice falls below $8, more than 14% below the current price of $9.32, indicating the downtrend is accelerating rather than bottoming near support.