Noah Education Holdings Ltd. (NED)

[EZ2]

Noah Education Rises on Initiation
Wednesday November 28, 11:03 am ET
Noah Education Rises As Analyst Starts Coverage, Citing Strong Position in Chinese Market

NEW YORK (AP) -- American Depositary shares of Noah Education Holdings Ltd. rose Wednesday after an analyst began coverage, saying the Chinese provider of interactive education content is poised to gain from robust growth in China's education market.

The shares advanced 99 cents, or 12 percent, to $9.24 in morning trading.

The company had its initial public offering in October, which priced well above expectations.

CIBC World Markets Corp. Scott Schneeberger initiated coverage of Noah Education at "Sector Outperformer," with a $14 price target.

"We are drawn to Noah for its leadership position in providing digitally interactive learning content in the briskly expanding education market in the rapidly growing Chinese economy," Schneeberger wrote in a client note.

Schneeberger said the company's target market is "substantial," with 291 million people between the ages of 5 and 19 in China. He added that 93 million of those are students in primary and secondary schools in urban areas.

Schneeberger also said many Chinese families are seeing their disposable income rise and place more importance on education for their children. Over the past 30 years, most Chinese families have only had one child, he added, thus placing greater emphasis on finding quality education.

"The child's education is clearly a top concern, second only to purchasing groceries," Schneeberger wrote in a client note.