On November 20, 2024, China International Capital Corporation (CICC) released a research report maintaining an "Outperform" rating and a target price of $145 on Futu Holdings. In the report, CICC pointed out the followings:

1. The performance slightly exceeded CICC's expectations, mainly due to the positive increase in new paying clients and the active trading of customers, driving revenue beyond expectations.

2. New user growth is favorable, with strong net inflows from paying clients and rallying markets pushing up the scale of clients' assets. The company added 154,000 new paying users in 3Q24, with Hong Kong and Singapore contributing more than one-third, and Malaysia being the most significant contributor among new markets.

3. The growth in transaction volume was partially offset by a decline in commission rates. Trading commissions remain the main driver of revenue growth, with steady increases in interest income growth.

4. In terms of expenses, total operating expenses increased by 1% QoQ to HKD 1.08 billion, of which marketing expenses decreased by 7% QoQ, corresponding to a slight decrease in the cost per customer acquisition to HKD 2,037 QoQ.

CICC maintains its "Outperform" rating on Futu Holdings, with a target price of $145, corresponding to 28x/22x P/E for 2024/2025 estimates and a 57% upside potential.

Risk Factors:

• Poor market transactions and sentiments.

• Industry competition exceeds expectations.

• International expansion falls short of expectations.