TAL Education: Earnings debate is fading; trust discount is not — yet

Research evidence excerpt

TAL Education: Earnings debate is fading; trust discount is not — yet

DS Kim AC Asia Pacific Equity Research

(852) 2800-8597 31 July 2026 J P M O R G A N

ds.kim@jpmorgan.com

Price Performance Summary Investment Thesis and Valuation

Investment Thesis

We remain OW on TAL as a high-quality compounder trading at

what we view as a low-quality multiple. TAL’s brand, asset

quality, and earnings-growth profile remain attractive, and we

believe the market is still underappreciating the compounding

potential of its core business. However, the investment case is

not without friction, admittedly. Investor engagement remains

constrained by limited disclosure, a somewhat unorthodox IR

approach, and the absence of a more convincing shareholder-

return framework. This creates a “trust discount,” where

YTD 1m 3m 12m earnings strength may be acknowledged but not fully capitalized

Abs -0.2% 14.9% 0.4% 6.8% into valuation. We think the current valuation still leaves

Rel 3.1% 1.5% 2.4% 12.5%

attractive upside for investors, supported primarily by earnings

Company Data growth rather than a full re-rating. A materially higher multiple

Shares O/S (mn) 553 would require the company to improve visibility, rebuild

52-week range ($) 13.37-8.88 investor trust, and demonstrate a clearer capital-allocation

Market cap ($ mn) 6,024

Exchange rate 1.00 framework.

Free float (%) -

Valuation3M ADV (mn) 3.66

3M ADV ($ mn) 37.1 Our Jun-27 price target of $16 is based on a 14x forward P/E, as

Volatility (90 Day) 40 we see TAL as an earnings-driven upside case, not (yet) a re-

Index HSCEI

BBG ANR (Buy | Hold | Sell) 20|2|0 rating call.

Key Metrics (FYE Feb)

Performance Drivers$ in millions FY26A FY27E FY28E FY29E

Financial Estimates

Revenue 3,009 3,707 4,289 4,934

Adj. EBITDA 396 710 857 1,013

Adj.