Newborn Town Inc. (9911) AI Stock Analysis

• Market Cap: HK$16.08B
• Dividend Yield: N/A
• Average Volume (3M): 4.06M
• Price to Earnings (P/E): 18.2
• Beta (1Y): 1.41
• Revenue Growth: 42.31%
• EPS Growth: 21.65%
• Country: HK
• Employees: 1,573
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.21
• Shares Outstanding: 1,412,958,400
• 10 Day Avg. Volume: 3,806,924
• 30 Day Avg. Volume: 4,062,158
• PEG Ratio: -1.24
• Price to Book (P/B): 2.58
• Price to Sales (P/S): 0.78
• P/FCF Ratio: 3.77
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$15.14
• Price Target Upside: 33.04% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: HK$11.50 ▲(1.05% Upside)

Newborn Town Inc. is well-positioned with strong financial performance, characterized by robust revenue growth and effective cash flow management. The technical analysis presents mixed signals, with some potential for short-term gains. The valuation is reasonable, though the lack of a dividend yield may deter income-focused investors. Overall, the company shows a solid foundation for future growth in the software application industry.

Positive Factors

Revenue Growth

The significant revenue growth indicates strong demand for the company's products and services, supporting long-term market expansion and competitive positioning.

Cash Generation

Strong cash generation enhances financial flexibility, allowing the company to invest in growth opportunities and manage liabilities effectively, supporting sustainable operations.

Low Debt Profile

Low leverage reduces financial risk and interest burden, providing stability and the ability to withstand economic fluctuations, enhancing long-term viability.

Negative Factors

Net Income Fluctuations

Fluctuating net income can indicate potential volatility in profitability, which may affect investor confidence and the company's ability to plan long-term investments.

Increasing Liabilities

Rising liabilities could strain financial resources, potentially impacting the company's ability to fund operations and growth initiatives if not managed properly.

Pressure on Net Profitability

Pressure on net profitability can limit reinvestment capabilities and affect shareholder returns, necessitating strategic adjustments to maintain financial health.

Newborn Town Inc. Business Overview & Revenue Model

Company Description

Newborn Town Inc., an investment holding company, operates as a mobile applications developer and mobile advertising platform services provider worldwide. The company provides live streaming services through social networking platform; and mobile marketing and advertising services through various mobile applications, as well as support services. It also offers Solo X product matrix; Solo Math, a programmatic mobile advertising platform; and Solo Aware, an artificial intelligence (AI) engine. The company was founded in 2009 and is headquartered in Beijing, the People's Republic of China.

How the Company Makes Money

Newborn Town Inc. generates revenue through multiple streams, including in-app purchases from its mobile applications, advertising revenue from its platforms, and subscription fees for premium services. The company monetizes its user base by offering free-to-use apps that encourage users to make purchases for enhanced features, virtual goods, or ad-free experiences. Additionally, strategic partnerships with advertisers and gaming companies enhance revenue opportunities by providing targeted advertising spaces within their applications. The growing user base and increasing engagement levels contribute to higher advertising rates and more significant in-app purchase volumes, driving the overall earnings of the company.

Newborn Town Inc. Financial Statement Overview

Summary

Newborn Town Inc. is in a robust financial position with strong revenue growth, healthy profit margins, and effective cash flow management. The company maintains a low debt profile and utilizes its equity efficiently. While net income shows minor fluctuations, the company's overall financial health and growth trajectory remain positive.

Income Statement

Newborn Town Inc. demonstrates strong revenue growth with a remarkable increase of 54% from 2023 to 2024. The company maintains robust profitability with a gross profit margin of 51.2% and a net profit margin of 9.4% for 2024. Furthermore, the EBIT margin stands at 14.3%, indicating efficient core operations. However, the slight decrease in net income from the previous year suggests some pressure on net profitability.

Balance Sheet

The company exhibits a solid financial position with a debt-to-equity ratio of 0.05, reflecting low leverage and financial stability. The equity ratio is strong at 43%, indicating a healthy reliance on equity financing. Return on equity is 31.2%, showcasing effective utilization of equity for generating profits. However, increasing liabilities over the years may need monitoring as a potential risk.

Cash Flow

Operating cash flow to net income ratio is strong at 2.2, indicating excellent cash generation relative to income. Despite a decrease in net income, free cash flow grew significantly by 41.8%, highlighting efficient capital management and expenditure control. The company's ability to generate free cash flow consistently supports its financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.00B	5.09B	3.31B	2.80B	2.36B	1.18B
Gross Profit	3.24B	2.61B	1.72B	1.06B	1.00B	757.52M
EBITDA	920.58M	886.05M	858.22M	291.38M	-337.03M	159.30M
Net Income	744.92M	480.31M	512.85M	130.13M	-286.28M	39.69M
Balance Sheet
Total Assets	3.89B	3.58B	2.79B	1.72B	1.62B	1.27B
Cash, Cash Equivalents and Short-Term Investments	2.37B	2.29B	1.56B	746.13M	890.71M	609.02M
Total Debt	111.87M	83.32M	108.27M	112.19M	10.77M	3.35M
Total Liabilities	1.76B	1.93B	843.36M	482.21M	782.33M	481.16M
Stockholders Equity	2.00B	1.54B	1.12B	707.82M	476.80M	536.47M
Cash Flow
Free Cash Flow	1.23B	1.05B	743.56M	301.74M	389.85M	293.60M
Operating Cash Flow	1.24B	1.06B	753.50M	312.64M	393.85M	295.67M
Investing Cash Flow	-4.32M	-86.77M	214.58M	-356.56M	-55.10M	-97.07M
Financing Cash Flow	-513.99M	-318.59M	-162.34M	-139.59M	-29.83M	72.85M

Newborn Town Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9911, the sentiment is Positive. The current price of 11.38 is above the 20-day moving average (MA) of 10.02, above the 50-day MA of 10.25, and above the 200-day MA of 9.83, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 68.71 is Neutral, neither overbought nor oversold. The STOCH value of 94.98 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:9911.

Newborn Town Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9911	73 Outperform	HK$16.08B	18.23	44.82%	―	42.31%	21.65%
9899	62 Neutral	HK$39.39B	13.86	24.41%	―	-4.23%	108.65%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3738	56 Neutral	HK$10.43B	47.91	8.42%	―	22.86%	5105.88%
3896	51 Neutral	HK$26.19B	-20.90	-15.92%	―	23.96%	55.68%
8083	43 Neutral	HK$4.56B	-52.14	-8.12%	―	3.97%	-211.11%
2013	40 Underperform	HK$7.07B	-4.22	-55.81%	―	-34.07%	-29.27%

Newborn Town Inc. Corporate Events

Newborn Town Inc. Strengthens Market Position with Strategic Share Purchase

Newborn Town Inc. has announced the purchase of 2,144,000 shares through Three D Partners Limited as part of its RSU Award Scheme, reflecting the company’s confidence in its business outlook. This move is intended to bolster shareholder value and is supported by the company’s solid financial resources, allowing for continued strategic share acquisitions.

Newborn Town Inc. Updates Logo and Provides Annual Report Supplement

Newborn Town Inc. has announced a change in its company logo, which will be reflected in all corporate documents moving forward. This change will not impact shareholders’ rights or the validity of existing share certificates. Additionally, the company provided supplemental information regarding its 2024 Annual Report, specifically about the NBT RSU Scheme, indicating that all shares related to awards granted in 2024 have been issued and transferred.

Newborn Town Inc. Enhances Shareholder Value Through Strategic Share Purchase

Newborn Town Inc. announced a share purchase under its RSU Award Scheme, with Three D Partners Limited acquiring an additional 2,052,000 shares, representing approximately 0.15% of the total shares in issue. This move reflects the company’s confidence in its business outlook and aims to create value for shareholders while maintaining a strong financial position.

Newborn Town Inc. Enhances Shareholder Value with Strategic Share Purchase

Newborn Town Inc. announced a share purchase under its RSU Award Scheme, where Three D Partners Limited acquired an additional 1,612,000 shares, representing approximately 0.11% of the total shares in issue. This move reflects the company’s confidence in its business outlook and is expected to create value for shareholders while maintaining a solid financial position.

Newborn Town Inc. Reports Strong Growth in 2025

Newborn Town Inc. reported significant growth in its social networking and innovative business segments for the first three quarters of 2025. The social networking business saw a 34.5% to 36.4% increase in revenue compared to the previous year, driven by AI-enhanced social products. Meanwhile, the innovative business experienced a 69.9% to 76.3% rise in revenue, attributed to the development of its traffic diversion, social e-commerce, and short drama businesses.