Investment Rating - The report maintains a "Buy" rating for the company [4][3]. Core Insights - The company reported strong earnings growth, exceeding previous guidance, with a Non-GAAP net profit of 1.83 billion RMB for Q3 2024, representing a year-on-year increase of 54.5% and a quarter-on-quarter increase of 29.1% [1][2]. - The net income for Q3 2024 increased by 2.1% quarter-on-quarter and 5.1% year-on-year, driven by an increase in the take rate and a reversal of provisions [1][2]. - The company has set a Q4 2024 Non-GAAP net profit guidance of 1.8 to 1.9 billion RMB, indicating a year-on-year growth rate of 57-65%, suggesting that the total Non-GAAP net profit for 2024 will exceed 6.2 billion RMB, with a growth rate exceeding 40% [1][3]. Financial Performance - The company achieved a net take rate of 5.9% in Q3 2024, up from 5.2% in the previous quarter, benefiting from improved risk management and lower funding costs [2]. - The company’s loan facilitation increased by 13% quarter-on-quarter in Q3 2024, with a loan balance growth of 3% [2]. - The proportion of light asset models in ongoing loan facilitation reached 55.1%, reflecting a year-on-year increase of 10.3% [2]. Stock Performance and Valuation - The target price has been raised from $27.5 to $38.4, based on a 6.5x P/E ratio for 2024, indicating an attractive valuation [3][4]. - The company announced a stock repurchase plan of $450 million for 2025, enhancing shareholder returns [3].

Financial Data and Key Metrics - Non-GAAP net income reached a record high of RMB 1.83 billion in Q3, up 29.1% sequentially and 54.5% YoY [8] - Non-GAAP net income per diluted ADS increased 34.8% sequentially and 71.5% YoY to RMB 12.4 [8] - ROE in Q3 increased to 32.2%, significantly higher than most financial services and internet companies in China [9] - Total loan facilitation and origination volume (excluding RM SaaS) increased by 13.1% sequentially [7] - D1 delinquency rate decreased by 0.2 percentage points sequentially, and 30-day collection rate increased by 1.1 percentage points to the highest level since 2022 [11] - Funding costs decreased by 30 basis points sequentially, and ABS issuance costs fell by more than 50 basis points [12] - Total ABS issuance for the first three quarters of 2024 reached RMB 13.4 billion, up 23% YoY [13] Business Line Data and Key Metrics - Capital-light segment contributed 55% of total loan facilitation and origination volume in Q3, up approximately 10 percentage points YoY [20] - Loan volume from embedded finance channels increased by 85% YoY, with new credit line users acquired through these channels increasing by roughly 5 percentage points [15] - The number of users with successful drawdown grew consistently each month, with the monthly average increasing by approximately 12% from the previous quarter [18] - Log-in conversion rate increased by 11.6% sequentially in Q3 [18] - Total Technology Solutions business partnered with an additional 9 financial institutions, bringing the total to 14, with solutions deployed in 10 of them [24] Market Data and Key Metrics - The company served more than 55 million users with approved credit lines cumulatively by the end of Q3 [7] - New credit line users increased by 23.8% sequentially, while average unit acquisition cost declined by 7.4% [14] - The proportion of new credit line users acquired through embedded finance channels increased by roughly 5 percentage points [15] - The company partnered with 5 financial institutions across various categories, including joint stock banks, municipal banks, private banks, and consumer finance companies [16] Company Strategy and Industry Competition - The company transitioned from a loan facilitation model to a platform model, focusing on long-term user engagement and diversified product offerings [21][22] - The platform model enables the company to address users' credit needs at different stages of their life cycle while balancing scale, risk, and profitability [22] - The company is leveraging AI and large language models to improve user experience and operational efficiency, with the AI copilot system achieving a recall rate of 96.3% and an accuracy rate of 98.8% [25][26] - The company is expanding its tech solutions beyond consumer credit services, developing a proprietary solution tailored for SME lending [25] - The company is confident in its competitive advantage, particularly in its target customer groups, and believes the platform model has made it more robust and resilient [68][69] Management Commentary on Operating Environment and Future Outlook - The company remains cautiously optimistic about the economic outlook but is confident in achieving long-term, high-quality growth [30] - The company expects risk performance to remain relatively stable in the coming quarters, assuming a muted macro environment [11][77] - The company anticipates total shareholder returns in 2024 to approach 100% of its 2023 net income, one of the highest payout ratios among Chinese ADRs [31] - The company expects non-GAAP net income for Q4 2024 to be between RMB 1.8 billion and RMB 1.9 billion, representing YoY growth of 57% to 65% [50] Other Important Information - The company completed the majority of its USD 350 million share repurchase plan and approved a new repurchase plan of USD 450 million starting January 1, 2025 [31][47] - The company generated approximately RMB 2.37 billion in cash from operations in Q3, with total cash and cash equivalents and short-term investments reaching RMB 9.77 billion [45] - The company's leverage ratio reached a historical low of 2.3x in Q3, and it expects the ratio to fluctuate around this level in the near future [44] Q&A Session Summary Question: Drivers of loan volume growth and outlook for 2025 [53] - Loan volume increased 4.4% sequentially, driven by a slight recovery in customer demand and the platform strategy [54] - The company remains prudent due to macroeconomic, geopolitical, and domestic policy uncertainties but is well-positioned to seize growth opportunities [56] Question: Drivers of write-backs and sustainability [59] - Write-backs increased significantly due to prudent provisioning policies and improved risk performance, with RMB 910 million in write-backs in Q3 [60][63] - Write-backs are expected to remain sizable in Q4 and beyond, though the shift to a capital-light model may reduce the need for large provisions [65][66] Question: Competitive landscape and strategy [59] - The company has a competitive advantage in its target customer groups and has transitioned to a platform model, improving customer retention and lifetime value [67][68] Question: Asset quality outlook [71] - The company expects stable risk performance in the near future, supported by its high-quality development strategy and advanced risk management technology [73][77] Question: Share buyback pace and price considerations [79] - The company plans to complete its current share repurchase plan by the end of 2024 and will execute the new USD 450 million plan starting January 1, 2025 [79][81] - The company believes its shares are undervalued and will prioritize share buybacks to maximize shareholder returns [80][83] Question: Take rate improvement and long-term outlook [86] - Take rate improvement in Q3 was driven by reduced credit costs, lower funding costs, and deferred impacts from mix changes [87] - The company expects take rate to remain stable in Q4 and improve slightly in 2025, with long-term sustainability dependent on macroeconomic recovery [89][91]

As of November 19, 2024, the Company had in aggregate purchased approximately 13.7 million ADSs in the open market for a total amount of approximately US$298 million (inclusive of commissions) at an average price of US$21.7 per ADS pursuant to the share repurchase plan. Business Outlook Conference Call Preregistration Registration Link: https://register.vevent.com/register/BI019bc78618c84e7184e794d691cfdb5b Safe Harbor Statement (Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("USD") except for n ...

User Growth and Engagement - As of September 30, 2024, the platform has connected with 162 financial institution partners and 254.3 million consumers with potential credit demand, an increase of 11.6% from 227.9 million a year ago[4] - The cumulative number of users with approved credit limits reached 55.2 million, up 12.2% from 49.2 million as of September 30, 2023[4] - The cumulative number of successful borrowers reached 33.1 million, reflecting a 12.6% increase from 29.4 million as of September 30, 2023[4] Financial Performance - Net income for Q3 2024 was RMB 4,370.2 million (USD 622.7 million), compared to RMB 4,281.0 million in the same period of 2023[7] - Operating profit for Q3 2024 was RMB 2,289.2 million (USD 326.2 million), up from RMB 1,388.9 million in Q3 2023[7] - Total revenue for Q3 2024 was RMB 43.7 billion (USD 6.2 billion), an increase from RMB 42.8 billion in Q3 2023 and RMB 41.6 billion in the previous quarter[11] - Non-GAAP net profit for Q3 2024 reached RMB 18.3 billion, reflecting strong financial performance despite challenging macro conditions[9] - The net profit attributable to ordinary shareholders for the nine months ended September 30, 2024, was RMB 4,347,677, up from RMB 3,173,596 in the same period of 2023, reflecting a growth of approximately 37%[45] Profitability Metrics - The net profit margin for Q3 2024 was 41.2%, with a non-GAAP net profit margin of 41.8%[7] - The company’s basic earnings per share for the three months ended September 30, 2024, was RMB 6.20, up from RMB 3.56 in the same period of 2023[45] - The company’s diluted earnings per share for the nine months ended September 30, 2024, was RMB 14.11, compared to RMB 9.61 for the same period in 2023, reflecting a growth of approximately 47%[45] Operational Efficiency - Operating costs and expenses totaled RMB 2,081.0 million (USD 296.5 million), down from RMB 2,892.2 million in Q3 2023[12] - The operating profit margin for the three months ended September 30, 2024, improved to 52.4% from 32.4% in the same period of 2023, showcasing enhanced operational efficiency[55] Cash Flow and Liquidity - Cash and cash equivalents totaled approximately RMB 97.7 billion, with operating cash flow of RMB 23.7 billion as of the end of Q3 2024[9] - The cash and cash equivalents at the end of September 30, 2024, were RMB 6,541,857 thousand, down from RMB 8,005,398 thousand at the end of the previous year, indicating a decrease in liquidity[48] - Net cash generated from operating activities for the three months ended September 30, 2024, was RMB 2,371,822 thousand, representing a significant increase compared to RMB 1,243,893 thousand for the same period in 2023[48] Risk Management and Credit Quality - The 90-day+ delinquency rate for loans on the platform was 2.72% as of September 30, 2024[4] - The first-day overdue rate was 4.6%, while the 30-day recovery rate reached approximately 87.4%, marking the best level in the past three years[9] - The provision for receivables was RMB 477.5 million (USD 68.0 million), a decrease from RMB 509.0 million in the same period of 2023 and RMB 849.5 million in the previous quarter[15] Shareholder Returns - The company announced a new share repurchase plan of USD 450 million for 2025[3] - The company executed a share repurchase plan totaling USD 350 million, with a new plan approved for USD 450 million, demonstrating commitment to shareholder returns[9] Future Outlook - The company expects net profit for Q4 2024 to be between RMB 1.75 billion and RMB 1.85 billion, reflecting a year-on-year growth of 57% to 65%[29] - The company plans to continue its market expansion and invest in new product development to sustain growth momentum in the upcoming quarters[57] - The company plans to maintain a prudent approach in its business planning due to ongoing macroeconomic uncertainties[29] Non-GAAP Financial Metrics - The company uses non-GAAP financial metrics to assess operational performance, excluding stock-based compensation expenses[38] - Non-GAAP operating income is defined as operating income excluding stock-based compensation expenses, providing insights into business trends[38] - The company emphasizes that non-GAAP financial data should be viewed as supplementary to GAAP results, not as a substitute[38] - The company believes that non-GAAP metrics enhance understanding of past performance and future outlook[38]

SHANGHAI, China, Nov. 19, 2024 (GLOBE NEWSWIRE) -- Qifu Technology, Inc. (NASDAQ: QFIN; HKEx: 3660) (“Qifu Technology” or the “Company”), a leading Credit-Tech platform in China, today announced its unaudited financial results for the third quarter ended September 30, 2024 and launched a new US$450 million share repurchase plan for 2025. Third Quarter 2024 Business Highlights As of September 30, 2024, our platform has connected 162 financial institutional partners and 254.3 million consumers*1 with potentia ...

SHANGHAI, China, Nov. 07, 2024 (GLOBE NEWSWIRE) -- Qifu Technology, Inc. (NASDAQ: QFIN; HKEx: 3660) (“Qifu Technology” or the “Company”), a leading Credit-Tech platform in China, today announced that it will report its unaudited financial results for the third quarter ended September 30, 2024, after U.S. markets close on Tuesday, November 19, 2024. Qifu Technology’s management team will host an earnings conference call at 7:30 PM U.S. Eastern Time on Tuesday, November 19, 2024 (8:30 AM Beijing Time on Wedne ...

Investors interested in stocks from the Technology Services sector have probably already heard of Qifu Technology, Inc. (QFIN) and Amplitude, Inc. (AMPL) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look. Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank is a proven strategy that ...

Core Viewpoint - The article emphasizes the importance of identifying sustainable trends in stock prices for short-term investing, highlighting Qifu Technology, Inc. (QFIN) as a strong candidate for trend investing due to its recent performance and positive fundamentals [1][3]. Group 1: Stock Performance - QFIN has experienced a significant price increase of 81.6% over the past 12 weeks, indicating strong investor interest [4]. - The stock has also seen a price increase of 17.7% over the last four weeks, suggesting that the upward trend is still intact [5]. - Currently, QFIN is trading at 99.1% of its 52-week high-low range, indicating a potential breakout [5]. Group 2: Fundamental Strength - QFIN holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. - Historically, Zacks Rank 1 stocks have generated an average annual return of +25% since 1988, underscoring the effectiveness of this ranking system [7]. Group 3: Investment Strategy - The article suggests that investors can utilize the "Recent Price Strength" screen to identify stocks like QFIN that are on an upward trend supported by strong fundamentals [3][8]. - There are over 45 Zacks Premium Screens available for investors to find stocks that align with their personal investing styles [8].

David focuses on growth & momentum stocks that are reasonably priced and likely to outperform the market over the long-term. He is a long term investor of quality stocks and uses options for strategy. David told investors to buy in March 2009 at the bottom of the financial crisis. The S&P 500 increased 367% and the Nasdaq increased 685% from 2009 through 2019. He wants to help make people money by investing in high-quality growth stocks.Analyst’s Disclosure: I/we have no stock, option or similar derivative ...

Qifu Technology, Inc. (NASDAQ: QFIN ) is a Chinese digital lending firm for young urban Chinese professionals and came into my notice last year and honestly, when I looked at its fundamentals, I liked it. The valuation was pretty solid andI am a financial writer with a degree in Finance. In my five-year career, I have worked with two financial companies. I keep a close eye on Energy, Banking, and Tech stocks. My main focus is fundamental analysis and looking at the long-term position of a stock instead of s ...