Bernstein lifts Kanzhun stock target to $18 on AI focus

On Wednesday, Bernstein SocGen Group updated its outlook on Kanzhun Ltd. (NASDAQ: BZ), raising the price target from $15.00 to $18.00 while maintaining a Market Perform rating. The adjustment follows Kanzhun’s fourth-quarter earnings, which met analyst expectations and highlighted the company’s commitment to artificial intelligence (AI) advancements. According to InvestingPro data, the company, currently valued at $7.95 billion, has demonstrated strong financial performance with a 30.4% revenue growth in the last twelve months.

During the earnings call, Kanzhun’s management emphasized the integration of AI into its Boss Zhipin platform, discussing features like query-based search, AI curation for recruiters, and automated screening processes. These developments are part of a broader strategy to enhance user experience and efficiency on the platform. The company’s robust gross profit margin of 83.12% and GREAT financial health score from InvestingPro suggest strong operational efficiency supporting these technological investments.

The company also revealed plans to launch a new suite of AI products in the coming months. While management did not specify the expected revenue impact from these offerings, they suggested that these innovations could improve the ratio of paying users and bolster market share, particularly against smaller competitors.

Bernstein’s analyst, Robin Zhu, expressed curiosity about the potential financial impact of AI on internet platforms, considering Kanzhun’s AI initiatives as a possible early indicator. However, the firm refrained from projecting the exact revenue implications, focusing instead on the technological enhancements and their strategic benefits.

Kanzhun’s focus on AI reflects a growing trend among internet platforms to leverage technology for competitive advantage. The company’s forthcoming AI products are anticipated to contribute to its ongoing efforts to refine platform functionality and user engagement. InvestingPro analysis suggests the stock is currently undervalued, trading at a P/E ratio of 37.96. For deeper insights into Kanzhun’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Kanzhun Ltd. reported its fourth-quarter results, prompting Jefferies to raise its stock price target from $17.00 to $20.00, maintaining a Buy rating. The company’s management highlighted positive trends, such as increased active users and job listings, alongside improvements in their cost-to-benefit ratio. Jefferies noted Kanzhun’s strategic advantage in the job recruitment market, particularly with its AI-driven platforms, and projected margin improvements by 2025.

Meanwhile, Changjin Limited experienced strong financial growth in the fourth quarter of 2024, with a 15% year-over-year increase in revenue, reaching RMB 1.82 billion. For the full year, revenue increased by 24% to RMB 7.36 billion. The company’s gross margin improved to 83.1%, and it served 225 million users and 16.6 million enterprises. Changjin Limited’s CEO emphasized the role of AI innovations in driving user expansion and financial performance.

The company forecasts Q1 2025 revenue between RMB 1.9 billion and RMB 1.92 billion, aiming for a non-GAAP operating profit of RMB 3 billion for the year. Changjin Limited plans to continue investing in AI applications and services to support its growth strategy.

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