US Stock Market News | LexinFintech's stock price rose by 16.59% in 4 trading days, with a total increase of 43.11% in stock price

According to Zhitong Finance APP, on Friday (September 28) Eastern Time, the U.S. stock market closed with Chinese concept stocks collectively rising, valuation recovery, and significant improvement in operating performance driving the stock price of Lexin, China's leading new consumer digital technology service provider, surged by 16.59%, closing at $2.39, with a trading volume of approximately $17.8098 million.

This marks Lexin's fourth consecutive trading day of gains, with a 13.9% increase the previous trading day, resulting in a 43.11% increase over the four trading days. Post-market data also shows a further 0.03% increase in Lexin's stock price.

Not only in terms of stock price, Lexin's daily trading volume has been above $4 million for the past four trading days, the first time since March 2022, and yesterday's trading volume of $17.8 million is also the highest in the past two and a half years.

On the market front, the significant 50 basis point rate cut by the Federal Reserve has weakened its stimulus effect on the stock market, and with easing U.S. inflation pressures, the three major U.S. stock indices closed with mixed results: the Dow rose by 0.33%, the S&P 500 fell by 0.13%, and the Nasdaq fell by 0.39%.

Driven by a series of consecutive favorable economic policies, popular Chinese concept stocks have shown strong performance, with the Nasdaq Golden Dragon Index rising by nearly 2%, Gaotu rising by over 6%, XPeng rising by over 5%, Pinduoduo, Nio, and JD.com rising by nearly 4%.

The rise in Lexin's stock price is mainly due to growth in multiple quarters' performance and valuation recovery.

Affected by the previous sharp decline in Chinese concept stocks, Lexin's stock price has fallen by around 70% from its high point. For comparison, in Q2 2024, Lexin's revenue was 3.64 billion yuan, a quarter-on-quarter growth of 12.3%; Non-GAAP EBIT was 310 million yuan, a quarter-on-quarter growth of 9%; Net Income was 230 million yuan, a quarter-on-quarter growth of 12.4%. In terms of scale, the company's transaction volume in the second quarter was 51.1 billion yuan; managed loan balance was 115.2 billion yuan; and the number of users was 220 million, a year-on-year growth of 10.2%.

The growth of Lexin's business is mainly attributed to its digital financial capabilities driven by the dual wheels of risk and data.

Under the dual wheels of risk and data, Lexin's high-quality development is yielding results, with steady growth in performance for seven consecutive quarters, five-time inclusion in the "Top 500 Chinese Service Enterprises," and close cooperation with multiple financial institutions. For example, in mid-September, Lexin signed a strategic cooperation agreement with Ningbo Bank and Ningbo Bank Consumer Finance for deep cooperation in financial technology, technical exploration, business innovation, and other areas.

At the same time, Lexin's international layout has achieved significant results, with loan scale in the Mexican market growing by 61% quarter-on-quarter in the second quarter, and revenue increasing by 113% quarter-on-quarter.

Boosting investor confidence, Lexin has decided to distribute dividends semi-annually starting from 2023, with a dividend ratio range of 15%-30% of the net profit in the most recent half year. For this distribution, cash dividends of approximately $0.072 per ADS will be paid, about 20% of the net profit in the first half of 2024.

Despite the four consecutive trading days of significant gains, Lexin's stock price is still undervalued by the market. Lexin's price-to-book ratio (PB) is only 0.272, making it one of the lowest among all internet financial technology targets. It is estimated that in the next two years, with changes in the regulatory environment and an overall increase in peer company valuations, the company's valuation will also rise According to reports, LexinFintech was established in August 2013 and is based in Shenzhen, China. It has been actively bridging online and offline extensive consumer scenes through its platforms, connecting millions of young Chinese consumers with new consumer brands. In December 2017, LexinFintech officially listed on the Nasdaq in the United States