On March 14, J.P. Morgan Chase released a research report, reaffirming Futu's rating of increasing its holdings, with a target price of 64 US dollars.
JPM points out the following key points:
Futu expects a 59% increase in new paying customers in 2024: Futu issued new guidelines and is expected to reach 350,000 new paying customers in 2024, an increase of 59% over 220,000 in 2023.
Overseas expansion is bearing fruit. Futu launched a brokerage business in Malaysia in February 2024. Furthermore, management revealed that customer acquisition in Japan accelerated in the first quarter due to strong market performance.
Share repurchase plan: Futu announced a $500 million repurchase plan, accounting for about 5.5% of the market value at the closing price on March 13. Futu will buy back up to $500 million worth of shares in 2024 and 2025. This will reduce the number of shares and increase return on equity.
Downside risk:
Profitability.
Cost control: CIR was 56.9% in the fourth quarter of '23 and 50.9% in the fourth quarter of '22.
External environment: Trading volume was weaker than expected.