A the number of students in China enrolled in degree courses has risen (from 1 to more than 6 million since 1997, see The Economist "A work in progress" March 17, 2011), CEDU's revenue has increased 13% in the last 12 months (NYSE:TTM). The company has beat earnings estimates 3 times in the last 4 quarters.
Even as earnings per share tripled in the last 2 years, its stock price is down about 8% since. It's P/E (TTM) is therefore only 16.19.
I think this stock is undervalued only because investors haven't paid enough attention to it.
Disclosure: I am long CEDU.