Core Viewpoint - Pop Mart's share price has faced pressure due to concerns over the fading popularity of Labubu and slower growth, but these concerns are viewed as overdone, with buybacks expected to restore market confidence [1] Group 1: Company Performance and Outlook - Pop Mart initiated buybacks of 1.34 million shares at HK$179.6 per share on January 19, 2026, marking the first buyback since February 15, 2024, signaling confidence in earnings and outlook [3] - The company expects robust revenue and net profit year-on-year growth of 32.8% and 37.6% respectively in 2026, driven by new product launches and overseas expansion [1] - The Monsters series, including Labubu, is projected to account for approximately 35% of global sales in 2025, with expectations to maintain this ratio in 2026 through new product launches [3] Group 2: Overseas Expansion - Concerns regarding overseas expansion are noted, but channel checks indicate a 60% repeat purchase rate among overseas consumers, suggesting sustained interest in various IPs [4] - Pop Mart plans to expand its store network to 691 by 2026, representing a 17% year-on-year increase, with significant growth expected in the US market [4] - The company aims to open 30 new stores in the US in 2026, increasing its total store count there to 92, a 53% rise [4] Group 3: Market Sentiment and Investor Concerns - Investors are primarily concerned about the fading popularity of Labubu and potential declines in store traffic as the brand's appeal diminishes [2] - The fragmentation of the overseas market raises concerns about growth outlook compared to 2023-2024 [2] Group 4: Valuation and Target Price - The target price has been revised to HK$291.9 based on a 20x 2026 P/E, reflecting a lower target multiple due to increased uncertainty regarding near-term growth [6] - Despite adjustments in revenue and EPS forecasts for 2025-2027, the company maintains a BUY rating, citing attractive valuation relative to growth potential [6]
POP MART INTERNATIONAL(9992.HK)CONCERNS ARE LIKELY OVERDONE：OUR TAKE ON 2026 OUTLOOK
Ge Long Hui·2026-01-22 06:20