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Investing.com - UBS initiated coverage on Meitu Inc (HK:1357) with a Buy rating and a price target of HK$13.60, citing the company’s potential to expand into the global creative software market.
The investment bank named Meitu as a sector top pick, highlighting its ability to leverage deep industry expertise in photography and design to drive monetization through its proprietary GenAI model called MiracleVision.
UBS identified productivity and globalization as key growth drivers for Meitu, complementing its consistently improving revenue base in its Life business segment.
The firm projects Meitu’s revenue to grow at a 27% compound annual growth rate (CAGR) from 2024 to 2027, while adjusted net profit is expected to increase at a 42% CAGR over the same period.
UBS believes Meitu is well positioned to unlock a total addressable market (TAM) that is 10 times larger than its current casual photo editing market by expanding into the global creative software market, which it refers to as the Productivity business.
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