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<Research>HSBC Research Favors MEITUAN-W/ JD.com/ NetEase Among CN Internet Stocks; KUAISHOU-W May Benefit from Stabilizing Competition
Recommend 64 Positive 129 Negative 47 |
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HSBC Global Research opined in a report that as the fundamental factors of Chinese internet stocks still overshadowed macroeconomic outlooks, it preferred stocks with better revenue prospects, potential catalysts, and undemanding valuations. The broker expressed a preference for MEITUAN-W (03690.HK) in light of its revenue growth based on low online penetration and stable competition. Forecasting an increase of 27% in the company's earnings this year even with market expectations of increased overseas investment, it gave the company a Buy rating with a target price of $220. The broker also rated JD.com (JD.US) as Buy with a target price of US$53 in the belief that the expansion and extension of trade-in programs will provide room for the company's earnings growth. Anticipating that NetEase (NTES.US) could benefit from the potentially stronger-than-expected PC revenue boosted by the launch of "Marvel Rivals", the upward potential of "Where Winds Meet", and a turnaround in earnings growth that may lead to a re-rating, the broker gave the company a Buy rating with a target price of US$115. Meanwhile, the report indicated that KUAISHOU-W (01024.HK)'s forecasted P/E ratio dropped to a trough of 8x despite its second-fastest earnings growth among major tech stocks as affected by intensified competition from Mini Shops and Douyin, which has casted a shadow over revenue prospects. If the TikTok US ban shows signs of hope, market concerns over competition in China's short video market may lessen, benefiting KUAISHOU-W's stock price. The broker rated the company at Buy with a target price of $68. AAStocks Financial News |
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