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The number of users reached a new high, and J.P. Morgan reassessed Kuaishou's value

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美港股觀察社 Jun 8, 2023 18:18 · 23.9k Views
In May, Kuaishou released earnings reports exceeding expectations, revenue growth recovered to 20%, and achieved profit after adjustments at the group level for the first time, and the company's stock price rebounded in response. As Kuaishou's performance improves, can Kuaishou's stock price break out of a wave of rebound? Let's take a look at J.P. Morgan's perspective.

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Transcript
  • 00:00 In May, Kuaishou released financial reports that exceeded expectations, and revenue growth returned to 20%
  • 00:04 Also, for the first time, profit was achieved after adjustment at the group level, and the company's stock price rebounded in response
  • 00:09 As Kuaishou's performance improves, can Kuaishou's stock price break out of a wave of rebound
  • 00:12 Let's take a look at J.P. Morgan's opinion
  • 00:14 Overall, J.P. Morgan is very optimistic about Kuaishou's dual improvement on the revenue side and profit side
  • 00:19 It is believed that Kuaishou's performance will change from short-term improvement to medium-term sustainable growth
  • 00:23 And this will also bring about a revaluation of Kuaishou
  • 00:25 J.P. Morgan believes that Kuaishou's performance improvement will be reflected in two aspects
  • 00:29 Rapid revenue growth and profit margin improvement
  • 00:31 The e-commerce business is growing rapidly, and the commission rate is constantly improving
  • 00:35 Thanks to increasing traffic monetization capabilities, Kuaishou's e-commerce GMV increased 28% year-on-year in the first quarter of this year
  • 00:41 At the same time, Kuaishou began extracting commissions from anchors' live broadcasts to drive revenue
  • 00:45 Achieve 50% faster growth
  • 00:47 Currently, Kuaishou's overall commission rate is still lower than the industry average, and the penetration rate of monthly active buyers into Mau is also relatively low
  • 00:53 This means that Kuaishou also has a lot of room to improve
  • 00:56 J.P. Morgan predicts Kuaishou e-commerce for the whole year in 2023
  • 00:59 MV will achieve 32% growth
  • 01:01 In addition to e-commerce business, Kuaishou's advertising revenue also increased 15% in the first quarter, driven by internal e-commerce advertisements
  • 01:07 Kuaishou's internal e-commerce advertising revenue increased 50% year-on-year in the first quarter
  • 01:11 It accounts for half of advertising revenue, which also reflects the popularity of e-commerce business
  • 01:15 For external performance ads despite poor revenue in the first quarter
  • 01:18 But J.P. Morgan is expected to be driven by games and offline advertising
  • 01:22 There will be an improvement starting in the second quarter, so the advertising revenue growth rate will also reach 21% in 2023
  • 01:28 Finally, for traditional live streaming services, Kuaishou's management effectiveness for anchors and content
  • 01:31 The rate improved, and revenue grew 19% in the first quarter
  • 01:35 This has increased market confidence
  • 01:36 J.P. Morgan predicts that as Kuaishou continues to expand, the number of high-quality anchors will increase user participation
  • 01:42 Live streaming revenue will continue to grow rapidly, and the revenue growth rate for the whole of 2023 will reach 19%
  • 01:47 Overall, all of Kuaishou's businesses have shown a trend of continuous improvement
  • 01:51 As a result, J.P. Morgan also raised its previous performance expectations, such as 2023 and 2024 revenue expectations by 4% and 3%, respectively
  • 01:59 Furthermore, with improved profitability, adjusted net profit for 2023 was increased by 193%
  • 02:04 The adjusted net profit will reach 3.8 billion yuan, and the profit forecast of 3.8 billion yuan will also break Kuaishou's valuation framework
  • 02:10 In the past, the market was worried about whether Kuaishou would be profitable and when it would be possible to make a profit
  • 02:14 Pay more attention to Kuaishou's short-term performance, and the future market
  • 02:17 Time will pay more attention to Kuaishou's continued profitability, and the stock value logic will also shift to medium- to long-term growth
  • 02:23 J.P. Morgan believes this will drive Kuaishou's stock price to rise
  • 02:25 According to the relative valuation method of 2.5 times interest income, J.P. Morgan Chase gave a target price of HK$80 for December 2023
  • 02:31 An increase of almost 70% compared to April's low