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On Monday, Citi analysts upheld their Buy rating and $30.50 price target for Atour Lifestyle Holdings (NASDAQ: ATAT), following a group investor call with the company. According to InvestingPro data, analysts maintain a strong consensus on the stock, with targets ranging from $28.95 to $38.30, suggesting potential upside from the current price of $27.47. The discussion revealed that the Chinese New Year (CNY) trends did not meet management expectations, primarily due to occupancy (OCC) underperformance, although the average daily rate (ADR) remained relatively stable. Despite these short-term challenges, InvestingPro analysis shows the company maintains impressive financial metrics, with a 76% year-over-year revenue growth and a strong return on equity of 53%.
Citi analysts pointed out that while there may still be uncertainty around revenue per available room (RevPAR), they anticipate reduced pressure starting from the second quarter of 2025, based on a normalized comparison base. The analysts expressed confidence in Atour’s ability to continue outperforming its competitors, citing the company’s unique experience-driven brand portfolio that has garnered customer recognition and offers faster returns to franchisees.
The forecast for Atour Lifestyle Holdings includes a rapid expansion of hotels and the growth of its sleep-focused retail business, which are both expected to contribute to significant growth in 2025. The commitment to maintaining the Buy rating was reinforced by the analysts’ outlook on the company’s ongoing strategies and market performance. InvestingPro data reveals the company is currently undervalued, with 8 additional ProTips and comprehensive financial analysis available to subscribers, including detailed insights into its growth trajectory and market position.
In other recent news, Atour Lifestyle Holdings has been the focus of several significant developments. Goldman Sachs recently initiated coverage on Atour Lifestyle, giving it a Buy rating and setting a price target of $34.40. This came after Atour’s impressive expansion in the Chinese hotel industry, with its hotel count rising from 420 in 2019 to 1,500 by the end of the third quarter of 2024.
In addition, Citi analyst Lydia Ling updated the firm’s outlook on Atour Lifestyle, raising the price target to $30.50 from the previous $29.50, following strong third-quarter financial performance. Atour reported a substantial year-over-year net profit increase of 47% to Rmb384 million, surpassing both Citi’s and consensus estimates. Revenue for the same period also rose by 47% year-over-year to Rmb1.89 million, aligning with expectations.
Lastly, Morgan Stanley (NYSE:MS) reiterated its Overweight rating on Atour Lifestyle with a steady price target of $32.50. The firm anticipates that Atour’s stock will outperform its industry peers in the coming 60 days, driven by projected robust growth figures. The company is expected to report over 40% year-over-year growth in both revenue and net income, surpassing the consensus forecast of a 30% growth rate. These recent developments highlight the growing confidence in Atour Lifestyle’s market strategy and financial performance.
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