Institutional investors can help increase bullish sentiment, particularly as they continue to increase their position over time. This becomes even more apparent when the institutional investor is among the world’s top ten largest asset management firms, with assets under management exceeding $1 trillion.
EdtechX Holdings (NASDAQ: EDTX) is one such company that has seen growing interest from an institutional shareholder and it happens to be the largest asset management firm across Europe: Amundi Asset Management.
SEC Filing: Amundi Holds 520,000 Shares of EDTX
Amundi Asset Management is a France-based firm that holds assets under management (AUM) of 1.653 trillion euros, according to their website. This effectively makes Amundi not only the largest asset manager in Europe, but also within the top ten in the entire world. The French asset manager has operations across 37 countries and serves over 100 million clients around the globe.
According to an SEC Schedule 13G filing from February 14, 2020, Amundi Asset Management holds 520,000 shares of EdtechX stock, which equates to 6.6% of the company. Equity research firm, Morningstar, shows that Amundi held 2.08% or 164,761 shares of EDTX at the end of January 2020.
This shows that Amundi has been increasing its position over the past several weeks within EdtechX. For existing shareholders of EDTX, this is a welcoming confirmation and a very strong addition to EdtechX’s bullish case.
EdtechX-Meten Merger & the Changing Chinese Education Landscape
One could argue that a portion of Amundi’s accumulation of EDTX has largely been due to the effects of the coronavirus outbreak on education in China. Just as we discussed is a previous article, China is currently suspending classrooms and offline education activities to help prevent the spread of the virus. As such, students have been relocated to online education platforms, which could provide even stronger growth to the industry than originally anticipated.
Prior to the virus outbreak, China’s education outlook (particularly online) was projecting very strong growth over the coming years. The virus is unlikely to change that outlook, but it may reshape the industry, which could see online-based education platforms come into even greater demand.
According to Bloomberg, “this could be the biggest sustained, mass experiment in online education since the internet was founded in the 1980s.” However, there will be some companies that see greater benefits than others.
EdtechX announced in December 2019 a merger agreement with Meten Education (China), a market leader in adult English Learning Training (ELT). Meten’s Likeshuo digital education platform particularly comes into focus, as the Chinese online education industry takes center stage.
Meten Shares Operational Update Showing Online Course Growth of 287% Y/Y
In a recent press release, Meten effectively confirmed the estimation that its digital education offerings could see even more impressive growth as a result of the outbreak.
“Driven by a combination of continuous enhancements to the Company’s digital offering and the impact of the coronavirus epidemic on the Chinese education industry, gross billings for Meten’s online courses increased approximately 287% year-on-year for the period between 1st and 17th February 2020. The number of new paying users during this period grew by 119% year-on-year,” according to Meten Education.
Meten confirms it is on track to meet its 2021 guidance of RMB 230 million in adjusted net income and RMB 301.1 million in adjusted EBITDA.
Overall, Amundi sees opportunity in EdtechX, which can be determined due to its increasing stake in the company. The company’s merger with Meten came at a very opportune moment, as the coronavirus outbreak forces Chinese students to switch over to an online learning format. This will give many students an opportunity to test out an online learning format, which could end up with a greater number of individuals remaining with the digital format even once the virus restrictions are lifted. In any event, Meten’s omnichannel business model allows it to capture offline & online growth of the Chinese education industry.
Spotlight Growth is compensated, either directly or via a third party, to provide investor relations services for its clients. Spotlight Growth creates exposure for companies through a customized marketing strategy, including design of promotional material, the drafting and editing of press releases and media placement.
All information on featured companies is provided by the companies profiled, or is available from public sources. Spotlight Growth and its employees are not a Registered Investment Advisor, Broker Dealer or a member of any association for other research providers in any jurisdiction whatsoever and we are not qualified to give financial advice. The information contained herein is based on external sources that Spotlight Growth believes to be reliable, but its accuracy is not guaranteed. Spotlight Growth may create reports and content that has been compensated by a company or third-parties, or for purposes of self-marketing. Spotlight Growth was compensated three thousand dollars for the creation and dissemination of this content by the company.
This material does not represent a solicitation to buy or sell any securities. Certain statements contained herein constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, without limitation, statements with respect to the Company’s plans and objectives, projections, expectations and intentions. These forward-looking statements are based on current expectations, estimates and projections about the Company’s industry, management’s beliefs and certain assumptions made by management.
The above communication, the attachments and external Internet links provided are intended for informational purposes only and are not to be interpreted by the recipient as a solicitation to participate in securities offerings. Investments referenced may not be suitable for all investors and may not be permissible in certain jurisdictions.
Spotlight Growth and its affiliates, officers, directors, and employees may have bought or sold or may buy or sell shares in the companies discussed herein, which may be acquired prior, during or after the publication of these marketing materials. Spotlight Growth, its affiliates, officers, directors, and employees may sell the stock of said companies at any time and may profit in the event those shares rise in value. For more information on our disclosures, please visit: https://spotlightgrowth.com//disclosures/