In a report released yesterday, Brian Gong from Citi maintained a Buy rating on Full Truck Alliance (YMM – Research Report), with a price target of $16.00.
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Brian Gong’s rating is based on Full Truck Alliance’s strong performance and strategic initiatives. The company has shown solid results with notable order volume growth, which management attributes to refined adjustments that have increased engagement among shippers and truckers. This engagement is expected to drive faster order volume growth in the future, despite a shift towards less-than-truckload (LTL) orders that may impact commission revenue growth.
Additionally, Full Truck Alliance is planning strategic investments that, while potentially affecting margins in the short term, are aimed at long-term growth. These investments include consolidating Plus PRC, enhancing AI technologies for improved matching efficiency, and boosting user acquisition efforts. Despite the short-term impact on earnings, these strategic moves, coupled with the company’s strong fundamentals, support the Buy rating with a positive outlook for order volume growth.