Investors looking for stocks in the Technology Services sector might want to consider either Futu Holdings Limited Sponsored ADR (FUTU) or Elastic (ESTC) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is ...

Investment Rating - The report does not provide a specific investment rating for the company, but it suggests actively monitoring the stock due to positive market conditions and growth potential [2]. Core Views - The company reported a revenue of HKD 25.9 billion for Q1 2024, representing a year-over-year increase of 4% and a quarter-over-quarter increase of 9%. Net profit was HKD 10.4 billion, down 13% year-over-year but up 18% quarter-over-quarter [2]. - The brokerage commission income was HKD 10.8 billion, showing no year-over-year growth but a 20% increase quarter-over-quarter. Total trading volume reached HKD 13 trillion, up 10% year-over-year and 40% quarter-over-quarter [2]. - The company has raised its full-year guidance for net new funded clients to 400,000, up from an initial estimate of 350,000, due to strong customer acquisition in overseas markets [2]. Summary by Sections Financial Performance - Q1 2024 revenue was HKD 25.9 billion, with a year-over-year growth of 4% and a quarter-over-quarter growth of 9%. Net profit was HKD 10.4 billion, down 13% year-over-year but up 18% quarter-over-quarter. Non-GAAP net profit was HKD 11.2 billion, down 12% year-over-year and up 18% quarter-over-quarter [2]. - Brokerage commission income was HKD 10.8 billion, with a year-over-year growth of 0% and a quarter-over-quarter growth of 20%. Total trading volume was HKD 13 trillion, with a year-over-year growth of 10% and a quarter-over-quarter growth of 40% [2]. Customer Growth - The company added 177,000 new funded clients in Q1 2024, a quarter-over-quarter increase of 331% and a year-over-year increase of 199%. The total number of funded clients reached 1.89 million, with a year-over-year growth of 24% and a quarter-over-quarter growth of 10% [2]. - The total customer assets reached HKD 517.9 billion, with a year-over-year growth of 11% and a quarter-over-quarter growth of 7% [2]. Cost Management - The gross margin for Q1 2024 was 81.9%, down 6.5 percentage points year-over-year but up 0.2 percentage points quarter-over-quarter. Research and development expenses were HKD 340 million, with a rate of 13%, down 1 percentage point year-over-year [2]. - Sales expenses increased to HKD 290 million, with a rate of 11%, up 6 percentage points year-over-year, primarily due to the significant growth in new funded clients [2]. Market Outlook - The report indicates that the company is well-positioned to benefit from the rebound in Chinese assets and plans to launch higher-commission cryptocurrency trading services in Hong Kong and Singapore [2]. - The company is actively expanding its overseas market presence and diversifying its product offerings, which is expected to create new growth opportunities [2].

Core Viewpoint - Futu Holdings Limited (NASDAQ:FUTU) has been assigned a Buy investment rating following its strong financial performance in Q1 2024, with upward revisions in client growth guidance indicating a positive outlook for the company [1]. Financial Performance - Futu Holdings reported Q1 2024 revenue of HK$2,592.5 million, reflecting a +3.7% YoY increase and a +9.2% QoQ growth, surpassing market expectations by +1.2% [4]. - The diluted GAAP net profit per ADS for Q1 2024 was HK$7.46, down -11.6% YoY but up +18.2% QoQ, indicating a +8.0% earnings beat compared to consensus estimates [6]. - The company experienced a significant increase in trading volume, with Hong Kong and US trading volumes rising by +18.0% QoQ and +48.1% QoQ, respectively [5]. Client Growth and Market Expansion - Futu Holdings revised its FY 2024 new customer growth guidance upwards by +14.3%, from 350,000 to 400,000 net additions, following a strong Q1 performance where net new paying clients surged by +330.8% YoY to approximately 177,000 [8][9]. - The company has made notable progress in international markets, securing 100,000 paying users in Malaysia shortly after launching and reaching one million app downloads in Japan [8]. Cost Management and Efficiency - The decline in R&D and brokerage costs contributed to improved earnings, with R&D expenses down -5.5% YoY to HK$335.5 million and brokerage expenses down -16.5% YoY to HK$60.3 million [6][7]. - The company attributed the reduction in costs to stricter cost control measures and improved operating efficiency from transitioning to self-clearing for US operations [7]. Valuation Metrics - The current market valuation of FUTU is at 16 times the consensus next twelve months' P/E, significantly lower than its five-year average forward P/E ratio of 26 times, suggesting potential for valuation expansion as the company continues to grow its customer base [11].

Futu Holdings Limited (NASDAQ:FUTU) Q1 2024 Earnings Call Transcript May 28, 2024 7:30 AM ET Company Participants Daniel Yuan - Chief of Staff to CEO and Head of IR Leaf Li - Chairman and CEO Arthur Chen - CFO Conference Call Participants Chiyao Huang - Morgan Stanley Katherine Lei - JPMorgan Operator Hello, ladies and gentlemen, welcome to Futu Holdings First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a ...

Client Growth - Total number of paying clients increased 23.5% year-over-year to 1,887,270 as of March 31, 2024[2] - New paying clients jumped by 330.8% year-over-year to 177,000, representing over 50% of the full-year guidance[4] Financial Performance - Total revenues increased 3.7% year-over-year to HK$2,592.5 million (US$331.3 million)[3] - Net income decreased 13.1% year-over-year to HK$1,035.1 million (US$132.3 million)[3] - Basic net income per American Depositary Share (ADS) was HK$7.53 (US$0.96), compared with HK$8.54 in the first quarter of 2023[13] - Net income for the three months ended March 31, 2024, was HK$1,035,133 thousand, down from HK$1,191,845 thousand in the same period of 2023, a decrease of about 13.1%[28] - Adjusted net income for the three months ended March 31, 2024, was HK$1,121,071 thousand, down from HK$1,267,955 thousand for the same period in 2023, a decrease of about 11.5%[34] Asset and Liability Management - Total client assets increased 11.2% year-over-year to HK$517.9 billion as of March 31, 2024[2] - Total current assets increased from HK$95,427,511 thousand as of December 31, 2023, to HK$105,582,064 thousand as of March 31, 2024, an increase of approximately 10.8%[23] - Total liabilities rose from HK$72,564,116 thousand as of December 31, 2023, to HK$81,662,755 thousand as of March 31, 2024, an increase of about 12.5%[25] - Total shareholders' equity increased from HK$24,568,736 thousand as of December 31, 2023, to HK$25,668,638 thousand as of March 31, 2024, an increase of approximately 4.5%[25] Trading and Revenue Metrics - Total trading volume in the first quarter of 2024 increased by 9.5% year-over-year to HK$1.3 trillion[2] - Daily average revenue trades (DARTs) increased 7.0% year-over-year to 549,854[2] - Margin financing and securities lending balance increased 8.9% year-over-year to HK$37.6 billion[2] - The company’s interest income for the three months ended March 31, 2024, was HK$1,354,166 thousand, up from HK$1,294,260 thousand for the same period in 2023, an increase of about 4.6%[27] Research and Development - Research and development expenses for the three months ended March 31, 2024, were HK$335,487 thousand, slightly lower than HK$354,899 thousand for the same period in 2023, a decrease of about 5.5%[28] Cash Management - The company’s cash and cash equivalents increased from HK$4,937,538 thousand as of December 31, 2023, to HK$6,643,541 thousand as of March 31, 2024, an increase of approximately 34.5%[23]

Core Viewpoint - Futu Holdings Limited reported its first quarter 2024 financial results, highlighting significant growth in client numbers and trading volumes, despite a decline in net income and gross profit compared to the previous year. Operational Highlights - The total number of paying clients increased by 23.5% year-over-year to 1,887,270 as of March 31, 2024 [2] - Registered clients rose by 15.4% year-over-year to 3,812,326 [2] - Total users grew by 12.3% year-over-year to 22.5 million [2] - Total client assets increased by 11.2% year-over-year to HK$517.9 billion [2] - Daily average client assets were HK$480.0 billion, up 6.0% from the same period in 2023 [2] - Total trading volume in Q1 2024 increased by 9.5% year-over-year to HK$1.3 trillion [2] - Daily average revenue trades (DARTs) rose by 7.0% year-over-year to 549,854 [2] - Margin financing and securities lending balance increased by 8.9% year-over-year to HK$37.6 billion [2] Financial Highlights - Total revenues increased by 3.7% year-over-year to HK$2,592.5 million (US$331.3 million) [3] - Total gross profit decreased by 3.9% year-over-year to HK$2,122.2 million (US$271.2 million) [3] - Net income decreased by 13.1% year-over-year to HK$1,035.1 million (US$132.3 million) [3] - Non-GAAP adjusted net income decreased by 11.6% year-over-year to HK$1,121.1 million (US$143.3 million) [3] Management Commentary - The company experienced a 330.8% year-over-year increase in new paying clients, totaling 177,000, marking the third highest quarterly growth in history [4] - New paying clients from Hong Kong and Singapore showed strong double-digit growth, while other markets saw triple-digit growth [4] - The launch in Malaysia attracted over 100,000 registered clients within six weeks, becoming the most downloaded financial app in the country [4] - Total trading volume increased by 40.0% quarter-over-quarter to HK$1.3 trillion, driven by heightened client interest in technology and high-dividend stocks [4] - Margin financing and securities lending balance reached an all-time high of HK$37.6 billion, up 13.7% sequentially [4] Wealth Management - Total client assets in wealth management were HK$64.0 billion, up 72.8% year-over-year and 11.1% quarter-over-quarter [5] - Bond holdings increased by 21.3% sequentially, driven by strong demand for U.S. treasury bills [5] - Wealth management asset balance in Singapore grew by 37.1% quarter-over-quarter [5] Cost and Expense Analysis - Total costs increased by 61.7% year-over-year to HK$470.2 million (US$60.1 million) [7] - Brokerage commission and handling charge expenses decreased by 16.5% year-over-year to HK$60.3 million (US$7.7 million) [7] - Interest expenses surged by 139.1% year-over-year to HK$312.8 million (US$40.0 million) [7] - Total operating expenses rose by 15.6% year-over-year to HK$929.5 million (US$118.8 million) [9] Income Metrics - Income from operations decreased by 15.1% to HK$1,192.7 million (US$152.4 million) [11] - Net income margin declined to 39.9% from 47.7% in the previous year [12] - Basic net income per ADS was HK$7.53 (US$0.96), down from HK$8.54 in the first quarter of 2023 [13]

Core Viewpoint Futu Holdings Limited reported its first quarter 2024 financial results, highlighting significant growth in client numbers and trading volumes, despite a decline in net income and gross profit compared to the previous year. Operational Highlights - The total number of paying clients increased by 23.5% year-over-year to 1,887,270 as of March 31, 2024 [2] - Registered clients rose by 15.4% year-over-year to 3,812,326 [2] - Total users grew by 12.3% year-over-year to 22.5 million [2] - Client assets increased by 11.2% year-over-year to HK$517.9 billion [2] - Daily average client assets were HK$480.0 billion, up 6.0% from the same period in 2023 [2] - Total trading volume for the first quarter was HK$1.3 trillion, a 9.5% increase year-over-year [2] Financial Highlights - Total revenues rose by 3.7% year-over-year to HK$2,592.5 million (US$331.3 million) [3] - Gross profit decreased by 3.9% year-over-year to HK$2,122.2 million (US$271.2 million) [3] - Net income fell by 13.1% year-over-year to HK$1,035.1 million (US$132.3 million) [3] - Non-GAAP adjusted net income decreased by 11.6% year-over-year to HK$1,121.1 million (US$143.3 million) [3] Management Commentary - The CEO noted a 330.8% year-over-year increase in new paying clients, totaling 177,000, which is over 50% of the full-year guidance [4] - Strong growth was observed in new markets, particularly Malaysia, where over 100,000 registered clients were attracted within six weeks of launch [4] - Despite market depreciation affecting client holdings, there was strong net asset inflow across all markets, especially in March [4] - Total trading volume increased by 40.0% quarter-over-quarter to HK$1.3 trillion, driven by heightened client interest in technology and high-dividend stocks [4] Wealth Management and Client Services - Total client assets in wealth management reached HK$64.0 billion, up 72.8% year-over-year [5] - The company had 430 IPO distribution and investor relations clients, a 21.8% increase year-over-year [5] Revenue Breakdown - Brokerage commission and handling charge income was HK$1,082.1 million, a slight increase of 0.3% from the previous year [6] - Interest income rose by 4.6% to HK$1,354.2 million, driven by higher margin financing income [6] - Other income increased by 23.7% to HK$156.2 million, primarily due to higher fund distribution service income [6] Cost Structure - Total costs increased by 61.7% year-over-year to HK$470.2 million [7] - Interest expenses surged by 139.1% to HK$312.8 million, mainly due to higher costs associated with securities borrowing and lending [7] - Selling and marketing expenses rose by 107.1% to HK$292.7 million, reflecting the increase in new paying clients [9] Profitability Metrics - Income from operations decreased by 15.1% to HK$1,192.7 million, with an operating margin decline to 46.0% [11] - Net income margin fell to 39.9% from 47.7% in the previous year [12] - Basic net income per ADS was HK$7.53, down from HK$8.54 in the first quarter of 2023 [13]

Core Viewpoint - Futu Holdings Limited Sponsored ADR (FUTU) is currently viewed as a better value investment compared to Cellebrite DI Ltd. (CLBT) based on various valuation metrics [1][3]. Group 1: Company Overview - Both FUTU and CLBT hold a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions and an improving earnings outlook for both companies [2]. - Value investors are interested in multiple valuation metrics to determine if a company is undervalued at its current share price levels [2]. Group 2: Valuation Metrics - FUTU has a forward P/E ratio of 17.41, while CLBT has a significantly higher forward P/E of 37.23 [3]. - The PEG ratio for FUTU is 1.25, indicating a more favorable valuation in relation to its expected earnings growth compared to CLBT's PEG ratio of 2.07 [3]. - FUTU's P/B ratio stands at 3.76, contrasting sharply with CLBT's P/B ratio of 64.97, further supporting FUTU's position as a more attractive value option [3]. - Based on these valuation figures, FUTU earns a Value grade of B, while CLBT receives a Value grade of C [3].

Core Viewpoint - Futu Holdings Limited is set to announce its financial results for Q1 2024 on May 28, 2024, before U.S. markets open, indicating a focus on transparency and communication with investors [1]. Group 1: Financial Results Announcement - The financial results for the first quarter ended March 31, 2024, will be reported before U.S. markets open on May 28, 2024 [1]. - An earnings conference call is scheduled for May 28, 2024, at 7:30 AM U.S. Eastern Time, allowing stakeholders to engage directly with management [1]. - Participants must pre-register for the conference call to receive access information [2]. Group 2: Company Overview - Futu Holdings Limited operates as a tech-driven online brokerage and wealth management platform, utilizing advanced technology to enhance the investing experience [3]. - The company offers a comprehensive range of investment services through its digital platforms, including trade execution, margin financing, and wealth management [3]. - Futu integrates social media tools within its platforms to foster connectivity among users, investors, and key opinion leaders [3].

Core Viewpoint - Futu Holdings Limited is set to report its financial results for Q1 2024 on May 28, 2024, before U.S. markets open, indicating a focus on transparency and communication with investors [1]. Group 1: Financial Reporting - The financial results for the first quarter ended March 31, 2024, will be announced before U.S. markets open on May 28, 2024 [1]. - An earnings conference call is scheduled for May 28, 2024, at 7:30 AM U.S. Eastern Time, allowing stakeholders to engage directly with management [1]. - Participants must pre-register for the conference call to receive access information, highlighting the company's organized approach to investor relations [2]. Group 2: Company Overview - Futu Holdings Limited operates as a tech-driven online brokerage and wealth management platform, emphasizing a fully digitalized financial service experience [3]. - The company offers a comprehensive range of investment services, including trade execution, margin financing, and wealth management through its platforms, Futubull and moomoo [3]. - Futu integrates social media tools within its services to enhance user connectivity and engagement with various stakeholders, including investors and analysts [3].