Saiyi He, an analyst from CMB International Securities, maintained the Buy rating on Meituan. The associated price target was lowered to HK$154.40.
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Saiyi He has given his Buy rating due to a combination of factors that highlight Meituan’s potential for future growth despite current challenges. The analyst acknowledges the fierce competition in the food delivery sector, which has led to a higher-than-expected adjusted net loss for Meituan. However, Saiyi He believes that the impact of incremental investments on operating profits has likely peaked, and anticipates a more rational competitive environment in the future. This expectation is based on Meituan’s ability to maintain its leadership in high-value food delivery orders.
Additionally, Saiyi He notes that while the core local commerce business is under earnings pressure, improvements are expected as the high season has ended and industry peers aim to enhance unit economics. The analyst also points out the significance of Meituan’s strategic transformation and international expansion initiatives, which are expected to contribute to loss reduction and revenue growth. Despite the near-term challenges, these strategic moves and the potential for a more favorable competitive landscape underpin the Buy rating for Meituan’s stock.
In another report released on October 9, TR | OpenAI – 4o also reiterated a Buy rating on the stock with a HK$116.00 price target.