Nomura said in a research report that it had raised its target price of 2% and 3% for 2019 and 2020, respectively, and raised its target price from HK$107 to HK$120, maintaining a “buy” rating. On November 27th the group rose nearly 3 per cent to HK$103.8, its highest level since the listing, with a market capitalisation of HK$600bn, making it the third-largest Chinese technology company by market capitalisation after Ali and Tencent.
Meituan Dianping earlier reported third quarter 2019 earnings, performance again exceeded market expectations, revenue continued to grow strong while continuing to achieve overall profitability. In the third quarter of 2019, Meituan Dianping reported operating income of RMB27.5 billion, up 44.1% YoY, while gross profit was RMB9.52 billion, up 109.8% YoY. The gross profit on takeaways in the third quarter was 19.5%, up 3 percentage points from the same period last year. The gross margin on emerging businesses was 18.7%, a significant improvement over the same period last year of -37.4%. Adjusted EBITDA and adjusted net profit were $2.3 billion and $1.9 billion, respectively. The day after the results were issued, the share price of Meituan Dianping exceeded HK$100.
Nomura said in a research report that it had raised its target price of 2% and 3% for 2019 and 2020, respectively, and raised its target price from HK$107 to HK$120, maintaining a “buy” rating.
Everbright Securities issued a research report on Meituan Dianping, said that Meituan Dianping this quarter in the premise of maintaining profitability to increase investment efforts, in all lines of business have achieved an effective increase in market share. In terms of profitability, the company’s overall realizability rate decreased slightly to 14.13% from 14.26% in the previous quarter, while gross margin was basically stable at 34.9%. Adjusted net income as a percentage of income edged up to 7.1%. Strengthening investments such as user incentives has not significantly negatively affected the company’s profitability. The company’s 2019-2021 revenue was revised to 949,130.6 billion yuan, and the company’s operating profit for 2019-2021 was RMB490 million, RMB6.78 billion and RMB15.27 billion, with an adjusted net profit of RMB1.2 billion, 9.2 billion and 17.2 billion yuan. Target price of HK$118/share, maintain a “buy” rating.
Huatron Securities said that the overall profitability of Meituan Dianping continued to improve, and is now at the starting point of profit, adjusting the 19-21 yearnonGAAP net profit forecast of 240 million, 12.8 billion, 21.2 billion (previous value – 920 million, 8.3 billion, 30.4 billion). The 2019 Borderless Giants’ earnings point has reached, and takeaways are on track to break even for the full year and make a full-year profit in 2020. Give food and beverage takeaway PS valuation (5X), corresponding to 2019 revenue of 56.5 billion, give 282.5 billion market value, to the shop and liquor business PE valuation (30X), corresponding to 2019 full-year net profit of 9 billion, give 270 billion market value, new business PS valuation (2X), full-year revenue of 20.2 billion, give 40.4 billion market value, The total amount was RMB593.2 billion, corresponding to HK$657.6 billion, with a target price of HK$113. Maintain a “recommended” rating.