Why Four Seasons Education (Cayman) Inc. (FEDU) stock soared today?

Four Seasons Education (Cayman) Inc. (FEDU) stock soared today after it announced the approval of the share repurchase program by its board members. FEDU stock price saw a surge of 32.73% to reach $0.73 a share at the time of this writing. The stock went high in the previous trade by 5.47% bringing the per-share price $0.58 at closing. Let’s explore more about this stock.

Four Seasons Education (Cayman) Inc is the provider of after-school tutoring services in the People’s Republic of China. Its main focus is to provide high-quality math education. It not only provides tutoring services but also organizes interest-oriented activities to improve the engagement of students.

What’s Happening?

Four Seasons Education today announced that its board of directors have approved the share repurchase program of the company. According to this program, FEDU stock will repurchase its own ordinary shares worth US$15.0 million in the form of American depositary shares. This share repurchase program will continue for the next 12 months. Four Season stock will fund this program through its existing cash balance, available working capital, or through anticipating cash from operational activities.

FEDU stock may perform share repurchasing through open market purchases or privately negotiated transactions. This program might be affected depending on general market conditions, business conditions, and working capital requirements.

Response of FEDU stock on New Regulations:

The previous few months were very difficult for most of the education stocks including FEDU due to educational reforms in China. Various restrictions by the Chinese government resulted in serious declines in the Chinese educational stock. FEDU stock in response to new regulations decided to comply with all the applicable rules and regulations. The stock had made it clear that following the new regulation would have adverse effects on its operational activities and prospects.

Financial View of FEDU stock:

According to the fourth quarter and fiscal 2021 unaudited financial results of FEDU stock,

Revenue was RMB70.2 million and the gross was RMB28.3 million, representing an increase of 14.1% from the prior year same quarter. Operating loss significantly improved to RMB8.5 million from the prior-year same period. Net loss declined to RMB11.5 million in the reported quarter as compared to RMB145.4 million in the previous year’s same quarter.

Conclusion:

Four Seasons Education has captivated the attention of investors after the recent announcement of the share repurchase program. Many investors are taking advantage of the low per-share price of this stock and anticipating well performance in the future.