CLSA lifts Futu stock to high-conviction outperform

On Thursday, CLSA analyst Hu Shen upgraded the rating for Futu Holdings Limited (NASDAQ:FUTU) from Outperform to High-Conviction Outperform. The firm maintains a price target of $130.00 on the stock. The upgrade comes as Futu demonstrates strong momentum, with the stock already up 51% year-to-date and showing an impressive 8.67% gain just last week, according to InvestingPro data. The upgrade is based on expectations of a stronger Hong Kong market and increased volatility in the U.S. market, which are anticipated to drive a 23% year-over-year growth in the company’s 2025 brokerage commission. With a current market capitalization of $16.7 billion and a P/E ratio of 28.69x, InvestingPro analysis suggests the stock is slightly overvalued at current levels, though strong growth metrics and a GREAT financial health score of 3.3 support the bullish outlook.

The analyst believes that Futu’s recent strategy in Hong Kong IPO subscriptions has been effective, contributing to growth in both clients and assets without significant net interest income (NII) loss. The firm is looking forward to a robust fourth-quarter earnings report scheduled for March 13, 2025. The company has maintained steady growth with revenue increasing by 11.68% over the last twelve months. For deeper insights into Futu’s financial health and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 top US-listed companies. According to the analyst, Futu’s current valuation at 16 times its 2025 projected earnings is considered undervalued.

Futu Holdings Limited, a tech-driven online brokerage and wealth management platform, has been actively adapting its strategies to navigate the dynamic financial markets. The company’s focus on Hong Kong’s IPO subscriptions has been a strategic move to attract more clients and expand its asset base.

The analyst’s commentary underscores the potential for Futu’s growth and profitability, especially given the market conditions that are seen as favorable for the brokerage’s operations. The firm’s analysis suggests that Futu is well-positioned to capitalize on the market dynamics and that its financial performance will reflect this in the upcoming earnings report.

Investors and market watchers will be keenly awaiting Futu’s fourth-quarter earnings in mid-March to assess whether the company’s performance aligns with CLSA’s projections. The upgraded rating to High-Conviction Outperform signifies a strong vote of confidence from the firm in Futu’s market strategy and growth prospects.

In other recent news, Futu Holdings Limited is expected to report a strong fourth-quarter performance, according to BofA Securities analyst Emma Xu. The analyst has raised the price target for Futu shares to $129.50, maintaining a Buy rating. Futu is projected to see a significant increase in new paying clients, with a 30% rise quarter-over-quarter, and a 240% increase year-over-year. Total (EPA:TTEF) client assets are anticipated to grow by approximately 7% quarter-over-quarter, driven by robust asset inflows. The company’s brokerage income is expected to grow by 39% quarter-over-quarter, while total revenue is projected to increase by 21%. Additionally, Xu forecasts an impressive growth in Futu’s net profit, with a 40% rise quarter-over-quarter. Investors are advised to monitor management’s guidance on various business trends during the upcoming earnings briefing.

Meanwhile, IceCure Medical (TASE:BLWV) Ltd. has appointed Mr. Li Haixiang as a new director on its Board. Mr. Haixiang brings extensive experience in finance, investment, and capital markets, and is the founder of Virtus Inspire Ventures. His appointment is part of IceCure Medical’s efforts to enhance its leadership and strategic direction. The company believes his expertise will provide valuable insight and guidance to the Board.

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