JPMorgan upgrades TAL Education on ‘Goldilocks environment’

JPMorgan upgraded TAL Education (TAL) to Overweight from Neutral with a price target of $15, up from $10. New Oriental Education’s November quarter beat and guidance suggests the post-policy tutoring business is in a “Goldilocks environment” with very favorable supply/demand dynamics and stable policy backdrop, the analyst tells investors in a research note. The firm thinks TAL’s “supernormal growth may have become the new normal,” as demonstrated by the company’s November quarter filing. JPMorgan raised revenue forecasts for TAL for the next three years by an average of 30% to Street highs, and expects the company’s earnings power to “surprise the market for years.”