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<Research>Nomura Cuts KUAISHOU-W (01024.HK) TP to HKD51, Maintains Neutral
Recommend 23 Positive 37 Negative 14 |
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Although the structural growth and rapid commercialization of Kling AI at KUAISHOU-W (01024.HK) present attractive long-term optionality, the stock faces severe operational headwinds in the near term, which may lead to further downward revisions to earnings forecasts, Nomura said in its report. Management's conservative guidance for 2Q26 indicated a clear slowdown in growth of its core revenue streams, while upfront investment in AI infrastructure is exerting pressure on margins. KUAISHOU-W management maintained its full-year capex guidance at RMB26 billion, of which approximately RMB12 billion had already been spent in 1Q. If competition forces faster model upgrades or expansion of computing power, there remains upside risk to capex. The broker kept its earnings forecasts for FY2026 and FY2027 largely unchanged, lowered the TP for KUAISHOU-W from HKD57 to HKD51, and maintained a Neutral rating. It also expected gross margin to narrow by 2.3 ppts in 2026, followed by further declines of 0.5 ppts and 0.4 ppts in FY2027 and FY2028, respectively. Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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