LB Select
2023.11.23 09:13
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Quick Look at the Big Banks | Nvidia's target price raised after earnings! Can BIDU-SWR rise another 75%?

Morgan Stanley believes that BIDU-SWR is currently undervalued and has short-term upside potential. This is because the commercialization of generative AI has progressed faster than expected, and it is expected to generate over 9 billion yuan in revenue next year, which has not been fully reflected in the stock price. The accelerated growth of BIDU-SWR's core advertising and cloud business also supports its stock performance.

Bank of America: Raises Nvidia's target price by 8% to $700

Based on the latest closing price of $487.16, this price implies a 44% upside!

JPMorgan: Maintains "Overweight" rating on Baidu, raises target price by 17% to HK$210

Based on the latest closing price of HK$119.8, this price implies a 75% upside!

The bank pointed out that Baidu's stock price has performed in line with the internet industry in the past month, but the bank believes that the company has short-term growth potential as the commercialization of generative AI is faster than expected. It is estimated that generative AI will generate over 9 billion yuan in revenue next year, and these factors have not been fully reflected in the stock price.

In addition, Baidu's core advertising and cloud businesses are growing faster, which also supports the stock price. The current price reflects a forecasted P/E ratio of 11 times for next year, which the bank believes is undervalued.

JPMorgan: Maintains "Overweight" rating on Kuaishou, target price of HK$90

Based on the latest closing price of HK$60.7, this price implies a 48% upside!

The bank stated that Kuaishou's performance in the last quarter exceeded expectations and its prospects are robust. The third-quarter revenue was 28 billion yuan, a year-on-year increase of 21% and a quarterly increase of 1%, exceeding the bank's and market's expectations by 2% and 1% respectively, mainly due to better-than-expected growth in live streaming and e-commerce.

The report pointed out that due to a significant increase in profit margins, Kuaishou's adjusted earnings per share were 0.72 yuan, exceeding JPMorgan's and the market's expectations by 41% and 19% respectively. The bank believes that the strong performance indicates a stable development of Kuaishou's fundamentals and will bring positive profit revisions in the next few quarters. At the same time, the bank expects the stock price of Kuaishou to have a positive response to its performance.

JPMorgan: Reiterates "Overweight" rating on Ctrip, target price of HK$393

Based on the latest closing price of HK$276.8, this price implies a 42% upside!

The bank stated that the group's third-quarter performance showed that its market share in China is growing better than expected, and it believes that this situation will continue and allow the company to maintain growth resilience under macroeconomic pressures. With the recovery of outbound tourism and international travel revenue, the bank believes that the company's revenue should grow by 18% next year.

The report pointed out that Ctrip's overseas hotel and flight bookings have recovered to 80% of pre-pandemic levels, compared to the industry average of 50%; domestic hotel and flight bookings are also higher than the industry average, with a similar gap to overseas bookings. The bank believes that the market has underestimated the extent of Ctrip's market share growth, with industry growth differing from Ctrip's revenue growth by 20% to 30%, which is believed to help the company buffer some cyclical businesses under the general slowdown in consumption. Goldman Sachs: Initiates coverage on Dongfang Zhenxuan with a "Neutral" rating and a target price of HK$28.

Based on the latest closing price of HK$31.75, this price implies a downside potential of 12%.

The bank expects the company's revenue to grow at a compound annual growth rate of 18% from 2023 to 2026, and the GMV to grow at a compound annual growth rate of 15%. It is expected that the adjusted net profit for the fiscal years 2024 to 2026 will remain stable at around 21% to 22%.

In addition, the bank holds a constructive view on Dongfang Zhenxuan's medium-term prospects, believing that the company has the potential for multi-platform expansion through its brand recognition and content-driven sales approach. The bank also highlights the company's ability to enrich its own brand inventory units (SKU) and leverage its advantages in live streaming channels, enterprise IP platforms, and content production, resulting in sustained profitability higher than its peers.

However, considering that the company is still in the early stages of development, the bank is waiting for a clearer growth trajectory in GMV from Douyin and Taobao Live.