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Chagee Holdings Limited Unsponsored ADR
(NASDAQ:CHA)
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Rating:74Outperform
Price Target:
$13.00
▼(-10.96% Downside)
Action:Upgraded
Date:07/09/26
CHA scores well on financial quality and valuation support (low leverage, ongoing profitability, and a high dividend yield), while the earnings call adds confidence due to sequential operational and margin recovery plus the buyback. The main constraint is cooling fundamentals versus prior highs (margin compression and weakening cash conversion) and only neutral-to-weak technicals with the stock still below its 200-day average.
Positive Factors
Revenue and Gross Margin Recovery
Sustained top-line growth with a 55.6% gross margin indicates durable product economics and pricing power. Sequential QoQ revenue and GMV improvement reflect operational fixes driving scale benefits, supporting reinvestment capacity and resilience versus peers over the next several quarters.
Negative Factors
Same‑Store GMV Decline
A ~16% YoY drop in same‑store GMV in the core market signals persistent demand weakness rather than pure store count effects. This undermines franchisee economics and suggests structural traffic or spending shifts that new openings or promotions may not fully offset over the coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and Gross Margin Recovery
Sustained top-line growth with a 55.6% gross margin indicates durable product economics and pricing power. Sequential QoQ revenue and GMV improvement reflect operational fixes driving scale benefits, supporting reinvestment capacity and resilience versus peers over the next several quarters.
Read all positive factors
Chagee Holdings Limited Unsponsored ADR (CHA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.10B
Dividend YieldN/A
Average Volume (3M)904.01K
Price to Earnings (P/E)15.2
Beta (1Y)1.23
Revenue Growth-0.06%
EPS Growth-47.26%
CountryUS
Employees4,800
SectorGeneral
Sector StrengthN/A
IndustryBeverages - Non-Alcoholic
Share Statistics
EPS (TTM)4.92
Shares Outstanding125,489,220
10 Day Avg. Volume678,322
30 Day Avg. Volume904,015
Financial Highlights & Ratios
PEG Ratio-0.24
Price to Book (P/B)1.80
Price to Sales (P/S)1.02
P/FCF Ratio11.09
Enterprise Value/Market Cap4.33
Enterprise Value/Revenue0.70
Enterprise Value/Gross Profit1.58
Enterprise Value/Ebitda6.72
Forecast
1Y Price Target
$15.25Price Target Upside4.45% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)8.77
Revenue Forecast (FY)$14.10B
Chagee Holdings Limited Unsponsored ADR Business Overview & Revenue Model
Company Description
Chagee Holdings Limited, operating through its various subordinate entities, is engaged in the ownership, operation, and licensing of teahouse establishments bearing the distinctive CHAGEE brand. These operations extend across the People's Republi...
How the Company Makes Money
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Chagee Holdings Limited Unsponsored ADR Earnings Call Summary
Earnings Call Date:May 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 28, 2026
Earnings Call Sentiment Positive
The call conveyed a constructive operational and financial recovery: sequential revenue and GMV growth, a clear profitability turnaround with higher operating and non-GAAP margins, strong overseas expansion and membership growth, and a USD 150 million share buyback authorization. However, meaningful year-over-year challenges remain — same-store GMV is still down year-over-year, non-GAAP net margin is lower than the prior-year period, franchisee revenues declined, and G&A and company-owned operating costs rose as the company scales. On balance the call was optimistic about execution and long-term value creation while acknowledging short-term YoY pressures and investments.Positive Updates
Revenue and GMV Growth (Sequential and YoY)
Total revenue RMB 3,546 million, up 4.5% year-over-year and 19.2% quarter-over-quarter. Total GMV RMB 7,917.8 million, up 8.1% quarter-over-quarter.
Negative Updates
Same-Store GMV Still Declining Year-over-Year
Overall same-store GMV growth remained negative year-over-year (management cited same-store GMV was down ~16% in Q1), although sequential improvement was noted (same-store GMV improvement of ~9.5 percentage points sequentially and Greater China same-store GMV improved by 9.4 percentage points).
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Q1-2026 Updates
Positive
Negative
Revenue and GMV Growth (Sequential and YoY)
Total revenue RMB 3,546 million, up 4.5% year-over-year and 19.2% quarter-over-quarter. Total GMV RMB 7,917.8 million, up 8.1% quarter-over-quarter.
Read all positive updates
Company Guidance
Management's guidance emphasized disciplined, operations-first execution across five dimensions—products, service, environment, experience and value proposition—with a steady launch cadence (12 new products in Q1) and expansion into tea lattes and special-deal categories, continued membership and experience upgrades, prioritized teahouse quality in Greater China and steady overseas expansion; this operational focus is supported by Q1 metrics: total GMV RMB 7,917.8m (+8.1% QoQ), revenue RMB 3,546m (+4.5% YoY, +19.2% QoQ), gross margin 55.6%, operating income RMB 547.2m (15.4% margin) and non‑GAAP operating income RMB 606.2m (17.1%), non‑GAAP net income RMB 506.7m (non‑GAAP net margin 14.3%), GAAP net income RMB 447.7m, cash balances ~RMB 7,146.3m (~USD 1.04bn), global teahouses 7,531 (7,157 Greater China, 374 overseas; 790 company‑owned, 6,741 franchisee), Greater China avg. monthly GMV/store RMB 356,080 (+5.5% QoQ), overseas GMV RMB 426.4m (+139% YoY, +14.6% QoQ), registered members 248m (≈50m active, +11% QoQ, 42.3% repurchase rate, >76% of orders from members with 2+ purchases), and a Board‑approved ADS repurchase program up to USD 150m over 12 months to reinforce capital return.Chagee Holdings Limited Unsponsored ADR Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
74
Positive
Cash Flow
67
Positive
| Breakdown | Mar 2026 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 12.91B | 12.41B | 4.64B | 491.65M |
| Gross Profit | 5.92B | 5.68B | 1.97B | 133.07M |
| EBITDA | 1.76B | 3.10B | 1.02B | -107.47M |
| Net Income | 1.17B | 2.52B | 800.90M | -90.72M |
Balance Sheet | ||||
| Total Assets | 11.47B | 6.60B | 2.94B | 393.96M |
| Cash, Cash Equivalents and Short-Term Investments | 8.00B | 4.85B | 2.42B | 200.75M |
| Total Debt | 1.28B | 548.06M | 108.84M | 63.45M |
| Total Liabilities | 3.89B | 3.84B | 2.53B | 701.31M |
| Stockholders Equity | 7.35B | 2.65B | 408.81M | -307.42M |
Cash Flow | ||||
| Free Cash Flow | 1.19B | 2.60B | 1.90B | 32.30M |
| Operating Cash Flow | 1.64B | 2.84B | 1.93B | 43.03M |
| Investing Cash Flow | -825.02M | -229.48M | -146.71M | -10.98M |
| Financing Cash Flow | 2.05B | -173.93M | 344.20M | -33.00K |
Chagee Holdings Limited Unsponsored ADR Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $2.10B | 15.16 | 11.93% | ― | -0.06% | -47.26% | |
74 Outperform | $4.08B | 49.13 | 25.43% | ― | 23.05% | 36.53% | |
67 Neutral | $3.17B | 17.04 | 35.99% | ― | -1.73% | -1.71% | |
58 Neutral | $7.82B | 76.46 | 7.51% | ― | 123.34% | 32.74% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
53 Neutral | $132.41M | -16.81 | -13.99% | ― | 9.76% | 67.59% | |
44 Neutral | $307.57M | -1.97 | -447.55% | ― | 8.84% | 10.68% |
* General Sector Average
CHA
Chagee Holdings Limited Unsponsored ADR
11.00
-14.60
-57.03%
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33.82
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30.60
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9.85
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ZVIA
Zevia PBC
1.72
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COCO
Vita Coco Company
71.40
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88.44%
Chagee Holdings Limited Unsponsored ADR Corporate Events
Chagee Posts Q1 2026 Revenue Growth but Margin Pressure Amid Shift to Company-Owned Stores
May 29, 2026
On May 29, 2026, Chagee reported unaudited results for the quarter ended March 31, 2026, showing net revenue growth to RMB3.55 billion despite economic headwinds and fierce competition in its core Greater China market. Total GMV reached RMB7.92 bi...
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.