Interactive Brokers shares jump as it secures spot in S&P 500
On Wednesday, Citi analyst Nelson Cheung increased the price target for HUYA Inc . (NYSE:HUYA) to $4.80, up from the previous $4.70, while reiterating a Buy rating on the shares. The adjustment follows HUYA’s first-quarter 2025 performance, which Cheung described as better than expected. The company, currently valued at $852 million, appears undervalued according to InvestingPro analysis, which has identified several positive indicators including strong balance sheet metrics and growth potential.
HUYA’s revenue remained stable year-over-year and quarter-over-quarter at Rmb1.51 billion, surpassing Citi’s and the Street’s expectations by 11% and 10% respectively. The company saw a slower decline in its live-streaming segment, with a 10% decrease year-over-year but a slight increase of 1.2% quarter-over-quarter. Its game-related services, advertising, and other revenues exceeded projections by 10%, reaching Rmb370 million, driven by strong distribution and sales of items for Tencent (HK:0700)’s titles, although this was somewhat counterbalanced by a higher baseline for brand advertisements. InvestingPro data shows the company maintains a healthy current ratio of 1.56 and holds more cash than debt on its balance sheet, demonstrating strong financial positioning.
The company also reported a non-GAAP net profit of Rmb24 million, which was more favorable than Citi’s and the Street’s estimates of a Rmb2.2 million loss and a Rmb14 million profit, respectively. Management has indicated optimism for 2025, expecting the company’s revenue to stabilize and stop declining. This aligns with InvestingPro analysis, which shows net income is expected to grow this year. Get access to 8 more exclusive ProTips and comprehensive financial analysis through InvestingPro’s detailed research reports.
The anticipated increase in new game releases in the second and third quarters, along with efforts to diversify revenue streams and expand into overseas distribution and sales, are projected to bolster game-related services revenue throughout 2025. HUYA’s implementation of an "AI + livestreaming" strategy is starting to yield positive results, enhancing user engagement during esports events and boosting the efficiency of content creation.
Following the review of HUYA’s performance and outlook, Citi has made a slight adjustment to the price target, now set at $4.80, based on a 1.25x multiple of the company’s estimated 2026 revenues of Rmb6.64 billion. The Buy rating reflects the firm’s continued confidence in HUYA’s potential for growth.
In other recent news, Huya Inc. reported mixed results for the first quarter of 2025. The company experienced a revenue increase to RMB1.51 billion ($207.9 million), surpassing analyst expectations of RMB1.42 billion. Despite this revenue growth, Huya’s adjusted earnings per share fell short, posting RMB0.10 ($0.01) against a consensus estimate of RMB0.67. The growth in game-related services, advertising, and other revenues, which rose 52.1% year-over-year to RMB370.4 million, helped counterbalance a decline in live streaming revenues. This segment now makes up 24.6% of total net revenues, up from 16.2% the previous year. The company’s average mobile monthly active users remained stable at 83.4 million, with the number of paying users flat at 4.4 million. Although net income attributable to Huya decreased to RMB0.9 million from RMB71.0 million a year ago, the company still achieved positive net income for the quarter. Huya aims to strengthen its content ecosystem and explore new commercial opportunities, especially in overseas markets.
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