JPMorgan downgraded Qfin (QFIN) to Neutral from Overweight with a price target of $21, down from $45, post the Q3 report. The firm cut estimates to reflect the scaling back loans with annual percentage yields above 24%. JPMorgan says it underestimated the indirect impact on both Qfin’s loan growth and APR, which it notes are now expected to decline due to increased competition for higher-quality clients. The firm cites the company’s “significant” earnings downside in Q3 and APR cap concern for the downgrade.
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