UBS: The market misreads the cooperation between KUAISHOU-W and MEITUAN-W, reiterates "Buy" rating
UBS released a research report stating that there have been rumors recently that Kuaishou-W and Meituan-W are collaborating to expand delivery services, raising market concerns about excessive competition. The report reiterates a "Buy" rating for Kuaishou, believing that the market is overly worried recently; the target price is HKD 95.37. The current price corresponds to a forecasted price-to-earnings ratio of 13.6 times for 2025, while the bank expects an average annual compound growth rate of 21% in earnings per share from 2024 to 2026, considering the valuation attractive. The bank believes the market has misinterpreted the news of Kuaishou's collaboration with Meituan, asserting that this initiative is Kuaishou further opening its ecosystem and traffic to Meituan, which is beneficial for Kuaishou as it can bring additional advertising demand; Kuaishou will not directly participate in the delivery business. Additionally, the bank noted that since the launch of the AI 2.0 version in April, the program's revenue ranking in the image design category of applications on iOS in the U.S. has significantly improved, with further growth in August. The bank believes that paid metrics reflect business performance better than user metrics, as user metrics may be influenced by media reports
According to Zhitong Finance APP, UBS released a research report stating that there have been rumors recently that Kuaishou-W (01024) is collaborating with Meituan-W (03690) to expand delivery services, raising market concerns about excessive competition. The report reiterates a "Buy" rating for Kuaishou, believing that the market is overly worried recently; the target price is HKD 95.37. The current price corresponds to a forecasted price-to-earnings ratio of 13.6 times for 2025, while the bank expects an average annual compound growth rate of earnings per share of 21% from 2024 to 2026, considering the valuation attractive.
The bank believes the market has misinterpreted the news of Kuaishou's collaboration with Meituan, asserting that this initiative is Kuaishou further opening its ecosystem and traffic to Meituan, which is beneficial for Kuaishou as it can bring additional advertising demand; Kuaishou will not directly participate in the delivery business.
Additionally, the bank stated that since the launch of the AI 2.0 version in April, the program's revenue ranking in the image design category applications on iOS in the United States has significantly improved, with further growth in August. The bank believes that paid metrics reflect business performance better than user metrics, as user metrics may be influenced by media reports
