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JPMorgan upgraded FUTU from Neutral to Overweight and raised the target price from $55.00 to $62.00

Moomoo News ·  Sep 1, 2022 05:43

On September 1, JPMorgan upgraded $Futu Holdings Ltd (FUTU.US)$ from Neutral to Overweight and raised the target price from $55.00 to $62.00.

JPMorgan pointed out the following highlights on FUTU:

  1. Total paying clients surpassed 1.39mil, +39% y/y or +5% q/q; this implies that Futu added ~143k new paying clients in 1H22, compared to the full year target of adding net 200k new paying clients in 2022;

  2. In terms of trading volume, Futu’s market share in HK increased by 26bps q/q to 2.8% in 2Q22. Market share in the US increased by 3bps q/q at 0.15%;

  3. Wealth management clients grew by 17% q/q and exceeded 200k in 2Q22, accounting for 14.6% of total paying clients;

JPMorgan upgraded Futu from Neutral to Overweightbased onthe following:

  1. 2Q22 results beat expectation on the back of stable client growth, market share gain;

  2. Regulators in the US and China signed an agreement on cooperation in the inspection of China ADR stocks which partially eases de-listing risk;

  3. J.P.Morgan's China Internet analyst Alex Yao expects China internet  stocks to deliver further earnings beats in 3Q22.

Risk:

  1. Weakness in China tech stocks, leading to lackluster trading volume growth;

  2. Regulatory risk;

  3. Lower-than-expected paying client growth.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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