Individual Investors Growth - 46 million new brokerage accounts were opened by individual investors in the U S during 2020-21, an 80% increase over a two-year period [1] - More than 75% of these new investors remain invested today, indicating a sustained interest in the market [1] The Investor Diaries Initiative - The Investor Diaries is a research initiative launched by The BlackRock Foundation and Commonwealth to understand new investors, particularly those earning low to moderate incomes (LMI) [9] - The initiative aims to provide insights into the financial circumstances, motivations, behaviors, and needs of LMI investors, and the role of capital market investing in their financial wellness [9] - The project will use voice diary entries, a national survey, and analysis of large transaction data sets to capture the experiences of LMI investors [9] Partnership with Investment Platforms - Commonwealth has partnered with Betterment and moomoo to capture participants' experiences with both robo-advised and self-directed platforms [10] - Betterment offers automated investment technology with diversified, expert-built portfolios, while moomoo provides an accessible platform for self-directed investors with advanced tools and features [11] About Commonwealth - Commonwealth is a national nonprofit that builds financial security and opportunity for LMI households through innovation and partnerships [6] - Over the past two decades, Commonwealth has enabled over 2 million people to save nearly $8 billion [6] About The BlackRock Foundation - The BlackRock Foundation focuses on making saving and investing more accessible and affordable for LMI households [7] - The foundation's Emergency Savings Initiative has provided access to more than 10 million people and led to $2 billion in new liquid savings between 2019 and 2022 [7] About Betterment - Betterment is the largest independent digital financial advisor, helping more than 900,000 customers manage over $50 billion with low-cost, expert-built investing portfolios [12] About moomoo - Moomoo is an investment and trading platform that provides global investors with pro-grade tools, data, and insights to make informed investment decisions [4] - The platform offers advanced charting tools, technical analytics, and in-depth data, along with educational resources and community features [4]

Investment Rating - The report maintains a **Buy** rating for Futu Holdings (FUTU US) with a target price of **$108.00**, representing a potential upside of **43.2%** from the current price of **$75.41** [1][5] Core Views - The report highlights that Futu Holdings' current valuation is attractive, with a 2024E P/E ratio of **16x**, significantly lower than its US internet brokerage peers [9] - The company's diversified overseas markets and product lines (stocks, equity derivatives, cryptocurrencies, wealth management products) are expected to enhance business stability [9] - The report expects Futu's ROE to remain around **18%** from 2024 to 2026, excluding special dividends [9] Financial Performance and Forecasts Revenue and Profit Growth - Revenue is expected to grow from **HKD 10,008 million** in 2023 to **HKD 12,848 million** in 2024E, representing a **28.4%** YoY increase [7][9] - Non-GAAP net profit is forecasted to grow from **HKD 4,572 million** in 2023 to **HKD 5,419 million** in 2024E, an **18.5%** YoY increase [7][9] - The report has revised its 2024E revenue forecast upward by **4.2%** and Non-GAAP net profit by **2.4%** [4] Key Financial Metrics - Gross margin is expected to remain stable at **81.9%** in 2024E, slightly up from **81.8%** in the previous forecast [4] - Net profit margin is projected to be **39.6%** in 2024E, down **0.6** percentage points from the previous forecast [4] - EPS is expected to grow from **HKD 30.78** in 2023 to **HKD 36.49** in 2024E, a **2.6%** upward revision from the previous forecast [6] Operational Metrics - The number of funded clients is expected to grow from **1.71 million** in 2023 to **2.31 million** in 2024E, a **34.9%** YoY increase [3][7] - Client assets are projected to grow from **HKD 485.6 billion** in 2023 to **HKD 645.9 billion** in 2024E [7] - Trading volume is expected to reach **HKD 7.1 trillion** in 2024, a **68%** YoY increase, driven by active trading in both Hong Kong and US markets [9] Market and Industry Context - The report notes that the Federal Reserve's slower pace of interest rate cuts is expected to stabilize Futu's net interest income, with a **3.7%** YoY growth forecasted for 2024 [9] - The company's overseas expansion and product diversification are seen as key drivers of future profitability, particularly in a high-interest-rate environment [9] Valuation and Peer Comparison - Futu's 2024E P/E ratio of **16x** is significantly lower than its US internet brokerage peers, making its valuation attractive [9] - The report suggests that supportive economic policies in China could further boost the company's valuation [9]

Company Analysis - Futu Holdings (NASDAQ: FUTU) stock experienced significant growth, increasing its value by four times in 2020 and then by 400% in January 2021 [1] - The company's stock has been highly volatile in recent years, but is now considered a clear buy [1] Industry Trends - The financial, consumer, and technology industries are key areas of focus for investment analysis [1] - Emerging technologies and their impact on younger generations are important considerations for long-term growth investments [1] Investment Philosophy - Deep research into business model trends is prioritized over short-term market trends or stock prices [1] - This approach aims to identify long-term growth opportunities while avoiding risky financial instruments [1]

Stocks with Buy Rank and Strong Momentum - mondaycom Ltd (MNDY) has a Zacks Rank 1 with a 159% increase in Zacks Consensus Estimate for current year earnings over the last 60 days The companys shares gained 141% over the last three months compared to the S&P 500s 63% gain and has a Momentum Score of A [1] - Futu Holdings Limited (FUTU) has a Zacks Rank 1 with a 67% increase in Zacks Consensus Estimate for current year earnings over the last 60 days The companys shares gained 366% over the last three months compared to the S&P 500s 63% gain and has a Momentum Score of A [2] - Vistra Corp (VST) has a Zacks Rank 1 with a 55% increase in Zacks Consensus Estimate for current year earnings over the last 60 days The companys shares gained 826% over the last three months compared to the S&P 500s 63% gain and has a Momentum Score of B [3]

Core View - Futu Holdings Limited Sponsored ADR (FUTU) is considered a superior value option compared to Braze, Inc (BRZE) based on valuation metrics [7] Stock Comparison - Both FUTU and BRZE currently hold a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions for both companies [3] - FUTU has a forward P/E ratio of 17.51, significantly lower than BRZE's 595.54 [5] - FUTU's PEG ratio of 0.86 is substantially more favorable than BRZE's 19.85 [5] - FUTU's P/B ratio of 3.17 is more attractive compared to BRZE's 8.76 [6] Valuation Metrics - The Value category evaluates companies using multiple metrics including P/E ratio, P/S ratio, earnings yield, and cash flow per share [4] - FUTU earns a Value grade of B, while BRZE receives a Value grade of F based on these metrics [6] Investment Strategy - The optimal approach for identifying value opportunities combines a strong Zacks Rank with a high grade in the Value category of the Style Scores system [2]

Business Services Group Overview - The Business Services group includes 304 companies and is currently ranked 4 in the Zacks Sector Rank [2] - The Zacks Sector Rank measures the strength of 16 sector groups based on the average Zacks Rank of individual stocks within the groups [2] Futu Holdings Limited Sponsored ADR (FUTU) Performance - FUTU is currently ranked 1 (Strong Buy) in the Zacks Rank, indicating potential for outperformance over the next 1-3 months [3] - The Zacks Consensus Estimate for FUTU's full-year earnings has increased by 252.2% over the past three months, reflecting improved analyst sentiment [4] - FUTU has gained approximately 55% year-to-date, outperforming the Business Services group average of 23.2% [4] - FUTU belongs to the Technology Services industry, which has gained an average of 32.1% year-to-date, further highlighting FUTU's strong performance [6] Willdan Group (WLDN) Performance - WLDN has outperformed the Business Services sector with a year-to-date return of 94.3% [5] - The consensus EPS estimate for WLDN has increased by 11.7% over the past three months, and the stock currently holds a Zacks Rank 2 (Buy) [5] - WLDN belongs to the Business - Services industry, which has declined by 4.7% year-to-date, making WLDN's performance particularly notable [6] Industry and Sector Insights - The Technology Services industry, which includes 162 companies, is currently ranked 67 in the Zacks Industry Rank [6] - The Business - Services industry, which includes 24 companies, is currently ranked 82 in the Zacks Industry Rank [6] Investment Outlook - Investors should continue to monitor FUTU and WLDN as they have demonstrated strong performance and potential for continued outperformance in the Business Services sector [7]

Investment Rating - The report does not explicitly mention an investment rating for Futu Holdings (FUTU) [2] Core Views - Futu Holdings continues to demonstrate strong growth through product innovation and market expansion, particularly in Southeast Asia [2] - The company achieved a 30% YoY increase in total revenue to HKD 3.4 billion in Q3 2024, driven by growth across all business segments [2] - FUTU's customer base and assets under management continue to expand rapidly, with total paying clients reaching 2.2 million, a 33% YoY increase [2][5] Financial Performance Revenue Breakdown - Brokerage commission and handling fee revenue grew 52% YoY to HKD 1.5 billion, despite a decrease in commission rates from 9.3 bps to 8.0 bps [2] - Interest income increased 13% YoY to HKD 1.7 billion, driven by margin financing and securities lending businesses [2] - Other income (including wealth management and corporate services) surged 52% YoY to HKD 209 million [2] Cost Structure - Total costs increased 43% YoY to HKD 625 million, primarily driven by higher interest expenses (up 43% YoY) and processing/service costs (up 51% YoY) [2] Profitability - Gross profit grew 27% YoY to HKD 2.8 billion, with a gross margin of 81.8% [2] - Operating profit increased 31% YoY to HKD 1.7 billion, with an operating margin of 50.4% [2] - Net profit rose 21% YoY to HKD 1.3 billion, with a net profit margin of 38.4% [2] Customer Growth and Market Performance - FUTU added 154,000 net new paying clients in Q3 2024, a 138% YoY increase [2] - Total client assets grew 48% YoY to HKD 693 billion, driven by stock appreciation and net asset inflows [5] - Hong Kong and Singapore markets contributed over one-third of new paying clients, while Malaysia remained the largest contributor for three consecutive quarters [4] Trading Volume and Market Activity - Total trading volume increased 17% QoQ to HKD 1.9 trillion [6] - US stock trading volume grew 23% QoQ to HKD 1.53 trillion, driven by increased interest in tech stocks and leveraged ETFs [6] - Hong Kong stock trading volume declined 3% QoQ to HKD 348 billion, despite a 267% weekly surge in late September [6] Product Innovation and Expansion - Launched US stock dividend reinvestment plan in Hong Kong [7] - Introduced NISA savings accounts and mutual funds in Japan, along with US stock margin trading and Japanese options [7] - Became the first broker in Malaysia to offer US stock options trading and launched MYR/USD-denominated money market funds [7] Capital Allocation - The board approved a special cash dividend of USD 0.25 per ordinary share or USD 2.00 per ADS, totaling approximately HKD 195 million [8] Financial Forecasts - Operating revenue is projected to grow from HKD 12.62 billion in 2024 to HKD 16.42 billion in 2026 [9] - Net profit is expected to increase from HKD 5.10 billion in 2024 to HKD 7.45 billion in 2026 [9] - EPS is forecasted to rise from HKD 4.59 in 2024 to HKD 6.78 in 2026 [9]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price raised from $90 to $108, indicating a potential upside of 24.6% from the current price of $86.70 [3][4][12]. Core Insights - The company's earnings for Q3 2024 met market expectations, with a net profit of HKD 1.32 billion, reflecting a year-on-year growth of 21% and a quarter-on-quarter growth of 9%. Revenue increased by 30% year-on-year and 10% quarter-on-quarter, primarily driven by brokerage commission income [1][2]. - The brokerage commission income saw significant growth, with trading volume increasing by 75% year-on-year and 17% quarter-on-quarter, reaching the highest level since Q2 2021. The proportion of US stock trading volume rose to 80.5% [1][2]. - The company plans to distribute a special dividend of $2 per ADS, totaling $280 million, which represents 61% of the net profit attributable to shareholders for the first three quarters [2]. Financial Performance Summary - For the fiscal year ending December 31, 2024, the company is projected to achieve revenues of HKD 12.325 billion, a net profit of HKD 4.945 billion, and an EPS of HKD 35.57, reflecting a year-on-year growth of 15.6% [7][9][15]. - The average customer acquisition cost decreased by 6.7% quarter-on-quarter to HKD 2,037, while the customer asset scale approached HKD 700 billion, marking a year-on-year increase of 48% [2][8]. - Wealth management assets grew by 88% year-on-year to HKD 97.3 billion, with 27% of paying users holding wealth management products, up 2 percentage points from the previous quarter [2][8].

Investment Rating - The report does not explicitly state an investment rating for Futu Holdings (FUTU) [2] Core Views - Futu Holdings reported Q3 2024 revenue of HKD 34.4 billion, exceeding Bloomberg consensus expectations of HKD 33.3 billion, with a year-over-year (yoy) increase of 30% and quarter-over-quarter (qoq) increase of 10% [2] - Net profit for Q3 2024 was HKD 13.2 billion, up 21% yoy and 9% qoq, while Non-GAAP net profit was HKD 14 billion, also up 21% yoy and 8% qoq [2] - The company announced a special cash dividend of USD 0.25 per share or USD 2 per ADS, totaling approximately USD 280 million [2] - Trading volume growth, particularly in US stocks, drove commission income, with US stock trading volume accounting for 80% of total trading volume [2] - Interest income increased by 13% yoy and 7% qoq, driven by higher average margin financing balances and increased idle fund interest income [2] - Other income surged 52% yoy and 29% qoq, primarily due to increased fund distribution and foreign exchange income [2] - Cost control was effective, with a gross margin of 81.8%, though net profit margin declined due to foreign exchange losses [2] - Overseas markets contributed significantly, with net inflows exceeding HKD 10 billion for three consecutive quarters [2] - The company's wealth management business saw total assets under management (AUM) grow to HKD 973 billion, up 88% yoy and 22% qoq [2] Key Metrics and Performance Revenue and Profit - Q3 2024 revenue: HKD 34.4 billion, yoy +30%, qoq +10% [2] - Net profit: HKD 13.2 billion, yoy +21%, qoq +9% [2] - Non-GAAP net profit: HKD 14 billion, yoy +21%, qoq +8% [2] Trading and Commission Income - Brokerage commission income: HKD 15.3 billion, yoy +52%, qoq +11% [2] - Total trading volume: HKD 1.9 trillion, yoy +75%, qoq +17% [2] - US stock trading volume: HKD 1.5 trillion, yoy +90%, qoq +23%, accounting for 80% of total trading volume [2] - Mixed commission rate: 8bps, yoy -1.2bps, qoq -0.5bps [2] Interest and Other Income - Interest income: HKD 17 billion, yoy +13%, qoq +7% [2] - Other income: HKD 2.1 billion, yoy +52%, qoq +29% [2] Cost and Expense Management - Gross margin: 81.8%, yoy -1.7pct, qoq +0.2pct [2] - R&D expenses: HKD 3.8 billion, yoy +7%, qoq +3% [2] - Sales expenses: HKD 3.1 billion, yoy +49%, qoq -7% [2] - Management expenses: HKD 3.8 billion, yoy +18%, qoq +5% [2] - Operating profit: HKD 17.3 billion, yoy +31%, qoq +17% [2] - Net profit margin: 38.4%, yoy -2.8pct [2] Client and Asset Growth - Net new funded clients: 154,000, yoy +138%, qoq flat [2] - Total funded clients: 2.2 million, yoy +33%, qoq +8% [2] - Client retention rate: over 98% [2] - Total client assets: HKD 6.934 trillion, yoy +48%, qoq +20% [2] - Wealth management AUM: HKD 973 billion, yoy +88%, qoq +22%, accounting for 14% of total client assets [2] Overseas Market Performance - Overseas markets contributed over HKD 10 billion in net inflows for three consecutive quarters [2] - Singapore client assets: qoq +18% [2] - Malaysia and Canada client assets: high double-digit qoq growth [2] Investment Recommendation - The company is expected to benefit from the resonance of Hong Kong and US stock market beta, with strong momentum in net inflows, trading volume, and turnover rates likely to continue in Q4 [2] - Expansion in Malaysia and Japan, along with the enrichment of overseas market product offerings, is expected to open new growth opportunities [2] - Based on Bloomberg consensus, the company's 2024/2025 PE ratios are 18X and 14X, respectively, indicating significant room for improvement compared to overseas peers [2]

Investment Rating - Buy (Maintained) [1] Core Viewpoints - Futu Holdings' 2024 Q3 performance continued its growth trend, with a significant increase in revenue and net profit [1] - The company announced its first special dividend, reflecting its commitment to shareholder returns [1] - Futu's user base and registered clients grew substantially, with strong contributions from overseas markets [1] - The company's revenue and net profit forecasts for 2024-2026 have been revised upwards, indicating positive growth prospects [1] Revenue and Profit Analysis - 2024 Q1-Q3 revenue increased by 19.9% YoY to HKD 9.158 billion, with Q3 revenue up 29.6% YoY to HKD 3.436 billion [1] - 2024 Q1-Q3 net profit attributable to the parent company rose by 4.7% YoY to HKD 3.564 billion, with Q3 net profit up 20.3% YoY to HKD 1.313 billion [1] - Brokerage commissions increased by 31% YoY in 2024 Q1-Q3 to HKD 4 billion, with Q3 commissions up 52% YoY to HKD 1.5 billion [1] - Interest income grew by 10% YoY in 2024 Q1-Q3 to HKD 4.6 billion, with Q3 interest income up 13% YoY to HKD 1.3 billion [1] - Other income increased by 35% YoY in 2024 Q1-Q3 to HKD 530 million, with Q3 other income up 52% YoY to HKD 210 million [1] Cost and Expense Analysis - 2024 Q1-Q3 operating expenses rose by 51% YoY to HKD 1.7 billion, with Q3 expenses up 43% YoY to HKD 630 million [1] - R&D expenses increased by 2% YoY in 2024 Q1-Q3 to HKD 1.09 billion, with Q3 R&D expenses up 7% YoY to HKD 390 million [1] - Sales expenses grew by 79% YoY in 2024 Q1-Q3 to HKD 950 million, with Q3 sales expenses up 48% YoY to HKD 380 million [1] - Administrative expenses increased by 11% YoY in 2024 Q1-Q3 to HKD 1.04 billion, with Q3 administrative expenses up 18% YoY to HKD 310 million [1] User Growth and Market Expansion - Futu's platform users, registered clients, and funded clients increased by 14%, 23%, and 33% YoY respectively in 2024 Q3 [1] - The company added 154,000 new funded clients in Q3, a 138% YoY increase, with significant contributions from Hong Kong and Singapore markets [1] - Overseas markets, including Japan, Canada, Malaysia, and Australia, saw double-digit growth in funded clients in Q3 [1] Special Dividend and Shareholder Returns - Futu announced a special cash dividend of USD 0.25 per ordinary share or USD 2 per ADS, totaling approximately USD 280 million [1] - The dividend represents 8% of the company's equity capital at the end of Q3, with no expected hindrance to future growth [1] Financial Forecasts and Valuation - 2024-2026 net profit forecasts have been revised upwards to HKD 5.03 billion, HKD 5.62 billion, and HKD 6.543 billion respectively [1] - The current market valuation corresponds to 2024-2026 PE ratios of 18.50x, 16.56x, and 14.22x [1] - The company's long-term growth potential is considered substantial, supported by its expansion into overseas markets and user base growth [1]