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TAL Education Group

NYSE · Consumer Defensive
TAL Education Group
TAL · Education & Training Services
$10.90
▼ -0.27 (-2.37%)
Data cached · refreshes every 10 min
Mr. Market is currently offering TAL Education Group at $10.90.
The business passes 4 of 6 of Graham's defensive criteria — adequate but not exceptional.
Overall Grade
C
Defensive
B
Enterprising
Profitability N/A
Fin. Health B
Years to Pay Off Debt 3.9 yrs
Working Capital vs Long-Term Debt $2.4B
Working Capital $2.7B
Valuation D
Margin of Safety 16.0%
Price-to-Book 1.33x
Cash Flow C
Free Cash Flow $286M
CapEx % of Net Income 132.7%
Owner Earnings $249M
4/6
Graham Score
Enterprising
Defensive — Graham's strict criteria (P/B, P/E, dividends, stability)  ·  Enterprising — Profitability & cash flow focused, accepts higher valuations for quality
Metric Explanations
What each dimension measures and where the thresholds come from.
Years to Pay Off Debt
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital vs Long-Term Debt
Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Margin of Safety
How far below the Graham Number the stock trades. Graham required a 33% discount as a buffer against analytical error. However, the Graham Number itself assumes 1960s-era P/E and P/B norms — for modern asset-light businesses it often understates true intrinsic value, making 0% MoS appear misleadingly bad.
Price-to-Book
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies. Negative P/B indicates book equity has been reduced by buybacks — common in highly profitable capital-return businesses.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Market Data
Market Cap $6.6B
Enterprise Value -$792M
P/E (TTM) 11.85
Dividend Yield N/A
Exchange NYSE
Key Margins
Gross Profit N/A
Operating Margin N/A
Net Margin N/A
Company Info
Sector Consumer Defensive
Industry Education & Training Services
Country China
Visit website
📖
Full Graham Analysis

Mr. Market is currently offering TAL Education Group at $10.90.

The business passes 4 of 6 of Graham's defensive criteria — adequate but not exceptional.

At $10.90, the stock trades below its Graham Number of $12.98 — suggesting a margin of safety exists.

The margin of safety of 16.0% offers some protection but falls short of Graham's preferred 33% buffer.

Trading at 2.1x NCAV. Expected for most quality businesses — NCAV was designed to find depression-era bargains and rarely applies to modern profitable companies..

Conclusion: This stock is better suited for Graham's Enterprising investor — one willing to devote time and skill to security selection.

About TAL Education Group

TAL Education Group provides K-12 after-school tutoring services in the People's Republic of China. It provides learning services primarily through small classes services; personalized premium services and online course offerings; and learning content solutions, such as print books, smart books, mobile apps, and AI-driven learning devices. The company also operates www.xueersi.com, an online education platform; provides investment management and consulting services; develops and sells software and networks, as well as related consulting services; and sells educational materials and products. It offers its services under the Haoweilai and Think Academy brands. The company was founded in 2003 and is headquartered in Beijing, the People's Republic of China.

Showing Key Metrics
Income Highlights
Metric 2026 2025 2024 2023 2022
Gross Profit % N/A • 53.3% 54.1% 57.2% 49.8%
Operating Margin % N/A • -0.1% -4.6% -8.9% -2.5%
Net Income % N/A • 3.8% -0.2% -13.3% -25.9%
Diluted EPS 0.92 ▲ 0.14 -0.01 -0.21 N/A
Balance Sheet Highlights
Metric 2025 2024 2023 2022
Total Assets $5.5B $4.9B $4.7B $5.1B
Total Debt $333M ↑ $239M $158M $242M
Working Capital $2.7B ▲ $2.6B $2.7B $2.7B
Years to Pay Debt 3.94 -66.95 -1.16 -0.21
Cash Flow Highlights
Metric 2025 2024 2023 2022
Free Cash Flow $286M ▲ $192M -$103M -$1.2B
Owner Earnings $249M $141M $15M -$700M
CapEx % of Net Income 132.7% N/A N/A N/A
These metrics estimate what TAL Education Group is worth based on its fundamentals — independent of what the market currently prices it at. Graham's Fair Value and NCAV are conservative floors rooted in 1930s–60s principles. EPV assumes zero growth. None are price targets — they are reference points for judging whether the current price offers a margin of safety.
Graham's Fair Value
$12.98
Margin of Safety
16.0%
Market Cap ÷ Company Value
1.00
P/B Ratio
1.33
Warren's Owner Earnings
$249M
Latest fiscal year
Graham's 7 Criteria
Defensive Investor Checklist
4/6 — Enterprising Investor
✅ Strong Financial Condition
2.86x
vs Current Ratio > 2.0x
❌ Earnings Stability
2 loss years (4 yrs data)
vs No negative EPS years
❌ Dividend Record
No dividend
vs Uninterrupted dividends
✅ Earnings Growth
+570.7% EPS growth
vs > 33% EPS growth
✅ Moderate P/E Ratio
11.9x
vs P/E ≤ 15.0x
✅ Moderate Price-to-Book
1.33x P/B (P/E×P/B: 15.8)
vs P/B ≤ 1.5x | P/E × P/B ≤ 22.5
Graham's 7 Criteria — Explained
What each criterion measures and why it may or may not apply to modern businesses.
✅ Strong Financial Condition — 2.86x vs Current Ratio > 2.0x
Current assets must be at least twice current liabilities. Note: highly profitable companies (Apple, Domino's) often run negative or low working capital deliberately — they collect cash fast and stretch payables. A failing score here is not always a warning sign.
"For industrial companies, current assets should be at least twice current liabilities."
❌ Earnings Stability — 2 loss years (4 yrs data) vs No negative EPS years
Graham required uninterrupted positive earnings. Any loss year is a red flag for defensive investors. Growth companies and cyclicals may show occasional losses during investment cycles or downturns without being fundamentally unsound.
"The company should have shown no deficit in the past ten years."
❌ Dividend Record — No dividend vs Uninterrupted dividends
Graham valued dividends as evidence of financial discipline and shareholder alignment. Many excellent modern businesses (Alphabet, Amazon, Berkshire Hathaway) pay no dividend, preferring to reinvest cash at high rates of return. Failing this criterion does not indicate a poor business — it may indicate a high-growth one.
"Some current dividend payments — for at least the past 20 years."
✅ Earnings Growth — +570.7% EPS growth vs > 33% EPS growth
EPS grew from $0.14 to $0.92 over 1 years. Graham's 33% threshold was set over a 10-year period. Measured over fewer years (as here), the bar is proportionally lower. Share buybacks can also inflate EPS growth without reflecting underlying business improvement.
"A minimum increase of at least one-third in per-share earnings over ten years."
✅ Moderate P/E Ratio — 11.9x vs P/E ≤ 15.0x
Graham's 15x P/E threshold was calibrated to 1960s market averages when interest rates were higher. Today's lower rate environment structurally supports higher multiples — the S&P 500 long-run average P/E is now closer to 20–25x. A stock trading at 20x is not automatically speculative in the modern context.
"The price-earnings ratio should be no more than 15 times average earnings."
✅ Moderate Price-to-Book — 1.33x P/B (P/E×P/B: 15.8) vs P/B ≤ 1.5x | P/E × P/B ≤ 22.5
Graham's 1.5x P/B threshold made sense when most company value was tangible. Today, intangible assets — brand, software, patents, network effects — rarely appear on the balance sheet. A high P/B in tech, pharma, or consumer brands often reflects intangible value, not overvaluation. P/FCF or EV/EBITDA are more reliable for asset-light businesses.
"The price should not be more than 1½ times book value. P/E × P/B ≤ 22.5."
Net Current Asset Value
$5.18
Trading at 2.1x NCAV. Expected for most quality businesses — NCAV was designed to find depression-era bargains and rarely applies to modern profitable companies.
"Buy at two-thirds of net current assets." — Graham
Earnings Power Value
N/A
Per share, no-growth floor. Compare to current price.
Cash Flow Analysis
Metric 2025 2024 2023 2022
Capital Expenditure % of Net Income 132.7% N/A N/A N/A
Repurchase of Capital Stock -$13M -$234M -$66M -$196M
Free Cash Flow $286M ▲ $192M ▲ -$103M ▲ -$1.2B •
Warren's Owner Earnings $249M $141M $15M -$700M
Peers & Industry
No auto-detected peers for Education & Training Services. You can manually compare TAL against any stock using the Compare tool.
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
Capital Allocation & Alignment
Insider Ownership
0.01%
Low — management has little skin in the game
Share Buybacks (Latest Year)
$13M
Management is returning capital to shareholders via buybacks
Debt Trend YoY
+39.3% YoY
Debt is growing — management is leveraging up
Leadership Team
Bangxin Zhang
Co-Founder, Chairman & CEO
Age 44
Zhuangzhuang Peng
President & CFO
Age 51
Yachao Liu
COO & Director
Age 43
Mi Tian
Senior Vice President
Age 41
Jackson Ding
Deputy Chief Financial Officer
Top Institutional Holders
Institution % Owned Shares
Blackrock Inc. 5.90% 27,305,227
FMR, LLC 4.65% 21,490,725
Krane Funds Advisors LLC 4.59% 21,231,472
UBS AM, a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC 4.23% 19,553,569
Vanguard Group Inc 3.82% 17,671,668
Morgan Stanley 2.95% 13,637,220
Coreview Capital Management Ltd. 2.38% 10,997,165
Bank of America Corporation 2.33% 10,755,536
Risk Analysis
Beta (Market Risk)
0.09
Low volatility — more stable than the market
Short Interest
7.2% of float
Moderate short interest
Debt-to-Equity
0.10x
Conservative balance sheet — low financial risk
Current Ratio
2.17x
Strong liquidity — Graham approved
52-Week Price Range
Low: $8.77 Current: $10.90 High: $13.37
Currently at 46% of 52-week range

TAL Education Group (TAL) fundamental analysis — Overall grade C based on profitability, financial health, valuation and cash flow. Graham's Fair Value: $12.98. Margin of safety: 16.0%. Gross profit margin: N/A. Operating margin: N/A. Net margin: N/A. Market cap: $6.6B. Sector: Consumer Defensive. Industry: Education & Training Services. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett principles.

Disclaimer: 360investing is provided for informational and educational purposes only and does not constitute financial, investment, legal, or tax advice. All data is sourced from public third-party providers and may be delayed, inaccurate, or incomplete. Past performance is not indicative of future results. Analysis, scores, and valuations are algorithmic and do not represent professional investment recommendations. Always conduct your own due diligence and consult a qualified financial adviser before making any investment decision. Use of this tool constitutes acceptance that 360investing and its operators bear no liability for decisions made based on information presented here.

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