UPDATE: Jefferies Downgrades New Oriental Education & Technology to Hold, Lowers PT

In a report published Wednesday, Jefferies & Company downgraded its rating on New Oriental Education & Technology Group

from Buy to Hold, and lowered its price target from $33.00 to $18.00. Jefferies noted, “EDU disclosed an on-going SEC investigation on its VIE structure. Downgrade to Hold from Buy and cut PT by 45% to US$18 due to this overhang. 4Q12 results were better than expected. FY13 revenue growth guidance of 25~30% driven by robust demand in 2~3 tier cities but lower than consensus due to negative impact from the macro economy slowing down. We revise down FY13 earnings by 6.5% due to more aggressive opening of learning centers.” New Oriental Education & Technology Group closed on Tuesday at $22.26.