Far Eastern University is known for producing generations of Tamaraws. Less known is that the school has also built one of the most profitable education businesses in the region.
Generations of Tamaraws know Far Eastern University for its historic campus along Nicanor Reyes Street in Manila. What many alumni may not realize is that the university they attended is also a publicly listed company with a market value of more than ₱19 billion.
This year, FEU received another distinction outside the academic world. It was one of seven Philippine companies included in Forbes Asia’s 2026 Best Under A Billion list, which recognizes 200 of the best performing small and midsized listed companies in Asia Pacific.
The recognition is significant because Forbes selected the 200 companies from a universe of more than 19,000 listed firms. Companies were assessed using measures that included debt, sales and earnings per share growth over one and three years, as well as one and five year average returns on equity.
FEU was not the only Philippine school to qualify. STI Education Systems Holdings also made the list. But education itself was a small part of a roster dominated by companies benefiting from technology, artificial intelligence and semiconductor demand. Software and semiconductor related businesses accounted for about 25 percent of the companies selected.
So how did a university founded in 1928 find itself among some of Asia’s best performing listed companies?
A highly profitable education business
For the fiscal year ended May 2026, FEU generated educational revenues of about ₱5.92 billion and consolidated net income of almost ₱2 billion. That translates into a net profit margin of roughly 34 percent.
Put another way, for every peso of revenue generated by the FEU Group, roughly 34 centavos became profit.
The profitability has also been sustained. Educational revenues increased from about ₱5.40 billion in FY2024 to ₱5.72 billion in FY2025 and ₱5.92 billion in FY2026.
However, the latest year also shows why investors should look beyond revenue growth. Operating income declined from ₱1.81 billion in FY2025 to ₱1.54 billion in FY2026, while net income slipped from ₱2.09 billion to about ₱2 billion.
FEU therefore remains highly profitable, but rising revenue did not translate into higher earnings last year.
FEU has grown beyond Morayta
Another reason for FEU’s financial strength is that the business alumni remember from the Manila campus has become a much larger education group.
FEU Main now accounts for only about 48 percent of the group’s educational revenue. FEU Tech contributes another 25 percent, while FEU Roosevelt accounts for 12 percent and FEU Alabang contributes 8 percent. FEU High School, FEU Cavite and other operations make up the balance.
This diversification gives FEU access to different student markets and locations rather than relying entirely on its original Manila campus.
The group now serves more than 50,000 students, according to Forbes.
FEU had already reported earlier that student population reached about 54,000 after a 7 percent increase, which helped produce what management then described as its highest net income.
A strong balance sheet
Growth has not required FEU to take on excessive financial risk.
At the end of May 2026, the group had approximately ₱20.84 billion in assets against only ₱3.34 billion in liabilities. This left FEU with about ₱17.5 billion in consolidated equity.
It also held about ₱2.57 billion in cash and cash equivalents.
This combination of profitability, low financial leverage and a large equity base helps explain why FEU fits the type of company Forbes looks for in its Best Under A Billion selection.
The university is also retaining capital for future expansion. Its financial statements show appropriations for campus development, building improvements, modernization, equipment and other strategic investments.
Is FEU stock as attractive as the business?
Strong companies, however, do not automatically make attractive investments. Price still matters.
At a recent market price of ₱800 per share, FEU has a market capitalization of approximately ₱19.24 billion.
With trailing earnings per share of ₱80.43, the stock trades at only about 9.9 times earnings. This translates into an earnings yield of roughly 10.1 percent.
FEU also trades at about 1.4 times book value, against a reported return on equity of 14.1 percent.
These numbers suggest that investors are not assigning a particularly aggressive valuation to one of Forbes Asia’s best performing smaller companies.
There is also a dividend component. FEU declared total cash dividends of ₱30 per share for FY2026, consisting of ₱16 per share in September 2025 and another ₱14 per share in February 2026. This compares with ₱32 per share in each of the previous two fiscal years.
At ₱800 per share, the ₱30 dividend translates into a trailing yield of about 3.8 percent.
This yield is not particularly high compared with some dividend stocks on the Philippine Stock Exchange. But FEU combines the dividend with profitability, relatively low leverage and a business that continues to generate substantial cash.
A different kind of investment
FEU’s attractive valuation comes with an unusual characteristic. Unlike many actively traded stocks, FEU has a relatively small trading volume.
Its three month average trading volume is only about 445 shares per day. At ₱800 per share, that represents average daily turnover of around ₱356,000.
The low trading activity may partly explain why FEU trades at a relatively modest P/E ratio despite its strong profitability and balance sheet. Investors often place lower valuations on stocks that are less liquid.
For long term investors, however, the more important consideration may be whether FEU can continue to grow its earnings and dividends over time.
The latest results offer a mixed but still encouraging picture. Educational revenues continued to increase in FY2026, although operating income and net income declined. Even after the decline, FEU generated close to ₱2 billion in consolidated profit and ended the year with ₱2.57 billion in cash and cash equivalents.
The company also continues to invest in campus development, building improvements, modernization and other initiatives that support future expansion.
For investors willing to hold the shares over a longer period, FEU therefore presents an interesting combination: a profitable education business, a strong balance sheet, regular dividends and a valuation of less than 10 times earnings.
More than a university
For FEU alumni, perhaps the most interesting part of the Forbes recognition is seeing how much the institution has changed.
Today, FEU is much more than its historic Manila campus. Its network of schools has grown into an education group with almost ₱6 billion in annual revenue and close to ₱2 billion in annual profit.
Forbes Asia’s recognition does not necessarily mean FEU shares are cheap. But behind the familiar green and gold of generations of Tamaraws is a business that has quietly become one of Asia’s more financially successful listed education companies.
