On March 15, CICC released a research report to maintain Futu Outperform rating and target price of 86 US dollars.
In its research report, CICC stated:
Earnings results below market expectations, but FY24 guidance for new depositing users exceeded expectations and a new buyback round announced.
Futu's 4Q23 results were below market expectations, mainly due to a decline in client turnover and interest income in 4Q. In addition, the company announced a new round of repurchase program, with a plan to complete up to $500 million of repurchases by the end of FY25. Overall customer acquisition accelerated, with the company guiding for 350,000 new deposits for the full year of FY24.
New market expansion accelerated, the company guides to 350,000 new deposits for the full year of 2014
With the recovery of the 1Q24 market and the acceleration of overall customer acquisition, the company guided 350,000 new deposit users throughout the year. Thanks to the optimization of the account opening and deposit process and targeted marketing, the Japanese market has accelerated customer acquisition since the end of 4Q, and also benefited from high brand awareness. The Malaysian market, which was newly entered in February, added 30,000 new account users within 1 week of the official exhibition.
It is expected that 1Q operating data will improve comprehensively, opening up long-term space for product expansion and international layout
With marginal market improvements since 1Q24, the company's operating data such as deposits and transactions is expected to improve across the board. At the same time, international expansion is progressing in an orderly manner. It is expected that with subsequent product categories and monetization methods being further enriched (such as Japanese stock trading & mutual finance, virtual assets, etc.), it is expected that it will continue to promote user growth and open up long-term space for deposit conversion.
Risks
Market transactions and prosperity are sluggish; industry competition exceeds expectations; international expansion falls short of expectations.