In a report released today, Sophie Huang from CMB International Securities maintained a Buy rating on Huya (HUYA – Research Report), with a price target of $6.80.
Sophie Huang has given her Buy rating due to a combination of factors including Huya’s stronger-than-expected fourth-quarter performance and a promising financial outlook for the fiscal year 2024. Huya’s latest earnings surpassed consensus expectations, with the company achieving a narrower margin of net profit loss compared to market predictions. Additionally, Huang foresees a continuation of margin improvements and an increase in game monetization through expanded cooperation with other companies, which is anticipated to drive revenue growth in the coming year.
Huang’s positive outlook on Huya is further supported by the company’s operational cost management and the development of new business segments that are expected to yield higher gross profit margins. The company’s strategic partnership with Tencent, involving multiple popular games, is set to contribute to significant growth in game-related revenues. Moreover, the analyst highlights Huya’s defensive position in the market, underscored by an attractive valuation, and its proactive shareholder return policy, which includes share repurchases and a substantial special dividend, as additional reasons for the Buy rating.
Huang covers the Communication Services sector, focusing on stocks such as Iqiyi, Walt Disney, and Netflix. According to TipRanks, Huang has an average return of 7.4% and a 47.92% success rate on recommended stocks.
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Huya (HUYA) Company Description:
HUYA, Inc. is a holding company, which engages in the development of game live streaming platform. The company provides live streaming content for mobile, personal computer, and console games. It also offers content to other entertainment genres, such as talent shows, anime, and outdoor activities. The company was founded in 2014 and is headquartered in Guangzhou, China.
