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KE Holdings Inc. Sponsored ADR Class A (BEKE)
:BEKE
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KE Holdings Inc. Sponsored ADR Class A
(NYSE:BEKE)
Rating:70Outperform
Price Target:
$20.50
▲(10.27%Upside)
Positive Factors
Holiday Sales Performance
Holiday sales signalled stable home-buying sentiment, with property sales performing strongly during the Labor Day public holiday.
Market Share Expansion
KE Holdings is expected to gain market share in both existing and new homes despite the challenging macro environment.
Revenue Growth
1Q25 revenue rose 42% YoY to RMB 23.3bn, mainly driven by new home and emerging business growth.
Negative Factors
Cost Challenges
Further expansion of agent teams and continuous shift to compensation structure may continue to refrain its profitability.
Earnings Guidance
The company's 2Q25/FY25 guidance implies non-GAAP NP significantly below market expectations.
Profitability Concerns
There is caution regarding the company's profitability due to rising headcount with higher compensation and CSR commitments, which may pressure earnings in the near term.
KE Holdings Inc. Sponsored ADR Class A (BEKE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.74B
Dividend Yield1.95%
Average Volume (3M)5.81M
Price to Earnings (P/E)34.8
Beta (1Y)0.62
Revenue Growth34.99%
EPS Growth28.80%
CountryUS
Employees135,072
SectorReal Estate
Sector Strength56
IndustryReal Estate - Services
Share Statistics
EPS (TTM)0.17
Shares Outstanding1,143,377,400
10 Day Avg. Volume4,759,112
30 Day Avg. Volume5,809,856
Financial Highlights & Ratios
PEG Ratio10.02
Price to Book (P/B)2.23
Price to Sales (P/S)0.00
P/FCF Ratio24.25
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$25.26Price Target Upside35.88% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
KE Holdings Inc. Sponsored ADR Class A Business Overview & Revenue Model
Company DescriptionKE Holdings Inc. Sponsored ADR Class A (BEKE) is a leading integrated online and offline platform for housing transactions and services in China. The company operates under the brand name 'Beike' and provides a comprehensive range of housing-related services, including existing home sales, new home sales, and home rentals. KE Holdings leverages its technology and data-driven platform to connect various stakeholders in the real estate industry, such as property owners, buyers, agents, and financial institutions, aiming to enhance efficiency and transparency in the housing market.
How the Company Makes MoneyKE Holdings Inc. generates revenue primarily through commission-based income from real estate transactions facilitated on its platform. The company earns commissions from both existing home sales and new home sales, acting as an intermediary between buyers and sellers. Additionally, KE Holdings derives revenue from value-added services, which include financial services such as mortgage facilitation and other home-related services. The company's robust online platform and extensive network of real estate agents and service providers play a crucial role in driving its transaction volume and, consequently, its revenue. Significant partnerships with developers and financial institutions also contribute to its earnings by enhancing its service offerings and market reach.
KE Holdings Inc. Sponsored ADR Class A Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q1-2025)
| % Change Since: -8.11%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call reflects strong revenue growth and expansion across key business segments, buoyed by strategic initiatives and AI integration. However, challenges remain in maintaining profit margins and revenue growth in certain smaller segments.Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Revenue increased by 42% year-over-year, reaching RMB23.3 billion, with notable growth across various segments.
GTV Increase
The Gross Transaction Value (GTV) rose by 34% year-over-year, totaling RMB844.2 billion.
Home Renovation and Furniture Segment
The segment experienced a 22.3% revenue increase year-over-year, with a 2 percentage point improvement in contribution margin.
Home Rental Services Expansion
Revenue in this segment reached a record high of RMB5.1 billion, up 93.8% year-over-year, due to rapid growth in the number of rental units under management.
AI Deployment and Efficiency Improvements
AI technologies have been effectively integrated to improve efficiency and service quality, with significant adoption among agents and service providers.
Negative Updates
Gross Margin Decline
Gross margin decreased by 4.5 percentage points year-over-year to 28.7%.
Contribution Margin Challenges
In-home transaction services saw a decline in contribution margin by 6.4 percentage points year-over-year.
Emerging and Other Services Revenue Drop
There was a 50% year-over-year and 20.3% quarter-over-quarter decrease in revenue for emerging and other services.
Company Guidance
In the first quarter of 2025, KE Holdings Inc., also known as Beike, demonstrated strong performance across multiple metrics, as discussed in their earnings call. The company's GTV (Gross Transaction Value) increased by 34% year-over-year, while revenue rose by 42% during the same period. Beike's new home transaction business saw a remarkable 53% year-over-year growth in GTV, significantly outperforming the national average reported by the NBS. Additionally, the platform's active agent count grew by 23%, adding over 90,000 agents from the previous year. Efficiency at the store and data level also improved, with GTV per store and per agent increasing by 8% and 14%, respectively. The company expects continued growth, driven by strong market momentum and strategic initiatives, including AI deployment, which has already enhanced service quality and operational efficiency.KE Holdings Inc. Sponsored ADR Class A Financial Statement Overview
Summary
KE Holdings presents a solid financial performance with strong growth in revenue and profitability. The company exhibits efficient operational performance and maintains a healthy balance sheet with manageable leverage. Cash flow metrics are particularly strong, indicating robust liquidity and financial flexibility. Potential risks include revenue volatility and leverage concerns.Income Statement
KE Holdings has demonstrated a robust revenue growth trajectory, with a notable increase in TTM revenue. The gross profit and net profit margins are healthy, reflecting efficient cost management. EBIT and EBITDA margins have improved over time, indicating strong operational efficiency. However, historical volatility in net income suggests potential risk factors that could affect future profitability.82
Very Positive
Balance Sheet
The company's balance sheet shows a strong equity base with a favorable debt-to-equity ratio, indicating a solid financial structure. Return on equity is improving, reflecting enhanced profitability. However, the equity ratio has slightly declined, which could signal increased leverage or asset utilization.78
Positive
Cash Flow
KE Holdings has shown consistent growth in free cash flow, supported by strong operating cash flow generation. The operating cash flow to net income ratio indicates robust cash conversion efficiency. The company maintains positive free cash flow, suggesting strong liquidity and the ability to fund operations and investments without relying heavily on external financing.85
Very Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 93.46B | 77.78B | 60.67B | 80.75B | 70.48B |
| Gross Profit | 22.94B | 21.72B | 13.78B | 15.82B | 16.86B |
| EBITDA | 4.90B | 9.31B | 817.87M | 762.60M | 4.25B |
| Net Income | 4.06B | 5.88B | -1.40B | -524.77M | 2.78B |
Balance Sheet | |||||
| Total Assets | 133.15B | 120.33B | 109.35B | 100.32B | 104.30B |
| Cash, Cash Equivalents and Short-Term Investments | 52.76B | 53.89B | 54.90B | 49.85B | 56.66B |
| Total Debt | 22.65B | 17.99B | 12.19B | 7.51B | 7.99B |
| Total Liabilities | 61.70B | 48.13B | 40.29B | 33.26B | 37.50B |
| Stockholders Equity | 71.32B | 72.10B | 68.92B | 66.97B | 66.77B |
Cash Flow | |||||
| Free Cash Flow | 8.41B | 10.28B | 7.67B | 2.17B | 8.47B |
| Operating Cash Flow | 9.45B | 11.16B | 8.46B | 3.60B | 9.36B |
| Investing Cash Flow | -9.38B | -3.98B | -8.47B | -24.88B | -14.98B |
| Financing Cash Flow | -5.79B | -6.96B | -1.15B | -1.07B | 25.41B |
KE Holdings Inc. Sponsored ADR Class A Technical Analysis
Negative
18.59
Price Trends
18.62
Negative
19.48
Negative
19.40
Negative
Market Momentum
0.10
Positive
44.28
Neutral
16.36
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BEKE, the sentiment is Negative. The current price of 18.59 is below the 20-day moving average (MA) of 18.84, below the 50-day MA of 18.62, and below the 200-day MA of 19.40, indicating a bearish trend. The MACD of 0.10 indicates Positive momentum. The RSI at 44.28 is Neutral, neither overbought nor oversold. The STOCH value of 16.36 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BEKE.
KE Holdings Inc. Sponsored ADR Class A Risk Analysis
KE Holdings Inc. Sponsored ADR Class A disclosed 95 risk factors in its most recent earnings report. KE Holdings Inc. Sponsored ADR Class A reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
KE Holdings Inc. Sponsored ADR Class A Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $46.34B | 43.63 | 13.13% | ― | 14.96% | 19.11% | |
77 Outperform | $12.60B | 24.00 | 8.16% | ― | 13.63% | 78.40% | |
75 Outperform | $40.33B | 373.44 | 1.30% | ― | 12.18% | -51.21% | |
74 Outperform | $2.82B | 17.61 | 9.53% | ― | 1.24% | 1205.18% | |
70 Outperform | $21.74B | 34.83 | 6.53% | 1.95% | 34.99% | 28.80% | |
65 Neutral | $1.97B | 18.69 | 2.45% | 5.16% | 0.63% | -5.29% | |
38 Underperform | $3.62B | ― | 40.75% | ― | ― | ― |
* Real Estate Sector Average
Performance Comparison
BEKE
KE Holdings Inc. Sponsored ADR Class A
18.20
4.90
36.84%
CBRE
CBRE Group
153.94
47.32
44.38%
CSGP
CoStar Group
94.60
21.90
30.12%
JLL
Jones Lang Lasalle
265.35
33.36
14.38%
CWK
Cushman & Wakefield
11.93
>-0.01
-0.08%
XHG
XChange TECINC
1.25
-460.75
-99.73%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.