Greater China Equity Long/Short Analyst

Eric Chen

With a blend of sell-side and buy-side perspectives, Eric has covered and researched hundreds of Greater China equities in TMT and consumer spaces - two sectors woven together by the overarching thesis of technology empowering consumption. 

Eric is highly experienced in fundamental equity long short strategy. He seeks to produce differentiated and original research that combines holistic qualitative framework, unique angles and robust modelling. The process helps gain deep insights into critical value drivers misunderstood by the market, which results in mis-priced stocks and hence long/short opportunities.

Meituan (3690 HK) – Staying vigilant in long-lasting competition

[Meituan (3690 HK, BUY, TP HK$165) Earnings Review]: Counterstrike Remains Effective… Maintain BUY

[Meituan (3690 HK, BUY, TP HK$165) TP Change]: Competition with Douyin Continues, Cut TP to HK$165

Equity Bottom-Up

<ul>
<li>The street’s expectations for Meituan’s bottom line have gone too pessimistic for 2023 while in the meantime too optimistic for 2024 and beyond.</li>
<li>Besides the macro weakness, we see the company’s growth increasingly be constrained by the business model itself, resulting in only 14% CAGR for bottom line over 2023-25 by our calculation.</li>
<li>We take investors’ indifference to Meituan’s strong bottom line growth for 2023 as a signal they are discounting the sharp deceleration kicking in from 2024. Stay neutral.</li>
</ul>


The street’s expectations for Meituan’s bottom line have gone too pessimistic for 2023 while in the meantime too optimistic for 2024 and beyond.
Besides the macro weakness, we see the company’s growth increasingly be constrained by the business model itself, resulting in only 14% CAGR for bottom line over 2023-25 by our calculation.
We take investors’ indifference to Meituan’s strong bottom line growth for 2023 as a signal they are discounting the sharp deceleration kicking in from 2024. Stay neutral.


Meituan (3690 HK): Strong Bottom Line Growth Will Prove to Be Short-Lived