Lexin(US:LX) BOCOM International·2025-05-23 00:23Investment Rating - The report assigns a "Buy" rating for the company, Lexin Group (LX US), with a target price of $11.80, indicating a potential upside of 36.1% from the current price of $8.67 [2][11]. Core Insights - The company has shown significant improvement in asset quality and has increased its dividend payout ratio. The dividend payout ratio was raised from 20% to 25% in November 2024, with plans to further increase it to 30% starting in the second half of 2025 [6][8]. - The net profit for Q1 2025 reached 430 million RMB, marking a 113.4% year-on-year increase, attributed mainly to a decrease in provisioning expenses [6][7]. - The company maintains guidance for substantial profit growth in 2025, with a projected net profit of 1.93 billion RMB, representing a 75% year-on-year increase [6][9]. Financial Performance Summary - Revenue for 2023 is projected at 13,057 million RMB, with a year-on-year growth of 32.3%. However, a decline of 4.6% is expected in 2025 [5][13]. - The net profit for 2024 is estimated at 1,100 million RMB, with a growth of 3.2% compared to 2023. The Non-GAAP net profit is expected to be 2,062 million RMB in 2025, reflecting a 71.4% increase [5][9]. - The company’s loan facilitation is projected to be 218 billion RMB in 2025, with a year-on-year growth of 3% [9][14]. Asset Quality and Risk Management - The 90-day delinquency rate improved to 3.3%, a decrease of 0.3 percentage points, indicating better asset quality [6][7]. - The company has shifted towards a low-risk business model, with the light asset model accounting for 28% of loan facilitation in Q1 2025, up from 20% in Q4 2024 [6][7]. Market Position and Comparison - The company’s market capitalization stands at approximately 1,149.56 million USD, with a year-to-date stock price increase of 49.48% [4][8]. - The stock has a 52-week high of $11.43 and a low of $1.62, showcasing significant volatility and potential for growth [4][8].