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Investing.com - Bernstein SocGen Group has lowered its price target on Meituan Dianping (HK:3690) (OTC:MPNGF) to HK$95.00 from HK$150.00 while maintaining a Market Perform rating, following disappointing second-quarter results.
The Chinese food delivery and local services giant reported revenue of RMB91.8 billion in Q2, representing 11.7% year-on-year growth but missing Bloomberg consensus estimates by 2.0%.
Meituan’s adjusted EBITDA fell dramatically to RMB2.8 billion, 81.5% lower than the same period last year, while Core Local Commerce operating profit dropped to RMB3.7 billion, a 75.6% year-on-year decline.
The significant earnings miss reflects what Bernstein describes as "the scars of the ongoing food delivery competition in China," with the firm estimating minimal Food Delivery revenue growth during the quarter based on Meituan’s commentary.
In-store, Hotel & Travel revenue growth was estimated in the mid-teens range, compared to what Bernstein characterized as a "low-thirties percentage operating margin" in that segment.
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