Core Viewpoint - KE Holdings Inc. has successfully adopted all proposed resolutions during its annual general meeting, which includes the re-election of key directors and the granting of mandates for share issuance and repurchase [1][2]. Company Overview - KE Holdings Inc. operates as a leading integrated online and offline platform for housing transactions and services in China, known for its Lianjia brand, which has over 22 years of operational experience [3]. - The company aims to enhance the efficiency of housing transactions and services, covering areas such as home sales, rentals, renovations, and furnishings [3]. Corporate Actions - The annual general meeting resulted in the re-election of Mr. Yongdong Peng and Mr. Yigang Shan as executive directors, and Mr. Jun Wu as an independent non-executive director [2]. - The directors were granted a general unconditional mandate to allot and issue additional Class A ordinary shares and to repurchase the company's own shares [2].

Core Viewpoint - KE Holdings Inc. (BEKE) shows a significantly improving earnings outlook, making it a strong investment choice as analysts continue to raise earnings estimates [1][6] Earnings Estimates - Analysts have reached a strong consensus in raising earnings estimates for KE Holdings, leading to a notable increase in consensus estimates for the upcoming quarter and the full year [2] - For the current quarter, KE Holdings is expected to earn $0.31 per share, reflecting a year-over-year increase of +14.81% [4] - The Zacks Consensus Estimate for KE Holdings has risen by 7.32% over the last 30 days, with no negative revisions [4] Current-Year Estimate Revisions - For the full year, KE Holdings is projected to earn $1.09 per share, indicating a year-over-year decline of -5.22% [5] - There has been a positive trend in estimate revisions for the current year, with two estimates moving up and no negative revisions, resulting in a 6.49% increase in the consensus estimate [5] Zacks Rank - KE Holdings currently holds a Zacks Rank 1 (Strong Buy) due to favorable estimate revisions, which is a reliable indicator for investors [6] - Research indicates that stocks with Zacks Rank 1 and 2 significantly outperform the S&P 500 [6] Stock Performance - The stock has gained 12.3% over the past four weeks, driven by solid estimate revisions, suggesting potential for further price increases [7]

Core Viewpoint - KE Holdings Inc. (BEKE) has seen a 12.3% increase in share price over the past four weeks, closing at $16.66, with a potential upside indicated by Wall Street analysts' mean price target of $21.23, suggesting a 27.4% increase from the current price [1] Price Targets and Analyst Consensus - The mean price target consists of eight short-term estimates with a standard deviation of $3.45, indicating variability among analysts [1] - The lowest estimate is $17, suggesting a 2% increase, while the highest estimate predicts a 68.1% surge to $28 [1] - A low standard deviation indicates a high degree of agreement among analysts regarding the stock's price movement direction and magnitude [4] Earnings Estimates and Analyst Optimism - Analysts have shown increasing optimism about BEKE's earnings prospects, as evidenced by a 6.5% increase in the Zacks Consensus Estimate for the current year, with two estimates revised higher and no negative revisions [5] - BEKE holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate factors, indicating strong potential for upside [5] Caution on Price Targets - While price targets are commonly used by investors, they can often mislead, as empirical research shows that they rarely indicate actual stock price movements [3] - Analysts may set overly optimistic price targets due to business incentives, which can inflate expectations [3]

Financial Performance - Gross transaction value (GTV) decreased by 35.2% year-over-year to RMB629.9 billion (US$87.2 billion) in Q1 2024, with existing home transactions down 31.8% and new home transactions down 45.4%[3]. - Net revenues fell by 19.2% year-over-year to RMB16.4 billion (US$2.3 billion), primarily due to declines in existing and new home transaction services[5][16]. - Net income was RMB432 million (US$60 million), while adjusted net income reached RMB1,392 million (US$193 million)[5][13]. - Total net revenues for the three months ended March 31, 2024, were RMB 16,377,314, a decrease of 19.0% compared to RMB 20,278,080 for the same period in 2023[68]. - Net income attributable to KE Holdings Inc. was RMB 431,774 for the three months ended March 31, 2024, a decrease of 84.3% from RMB 2,746,844 in the prior year[71]. - Adjusted net income for the three months ended March 31, 2024, was RMB 1,392,217, down from RMB 3,561,263 in the same period of 2023[76]. - The company reported a total comprehensive income of RMB 493,788 for the three months ended March 31, 2024, compared to RMB 2,424,671 in the previous year[71]. Revenue Breakdown - Revenue from home renovation and furnishing surged by 71.1% year-over-year to RMB2.4 billion (US$0.3 billion), driven by increased orders and enhanced delivery capabilities[21]. - Revenue from home rental services skyrocketed by 189.3% year-over-year to RMB2.6 billion (US$0.4 billion), attributed to the growth in rental units under the Carefree Rent model[21]. - Existing home transaction services generated RMB 5,577,030 in revenue, down 39.0% from RMB 9,181,199 year-over-year[68]. - Home rental services saw a significant increase in revenue, reaching RMB 2,625,203, up 189.5% from RMB 907,354 in the previous year[68]. - Home renovation and furnishing services saw an increase in net revenues to RMB 2,408,848, up 70.83% from RMB 1,407,931 in the same period of 2023[84]. Expenses and Margins - Total operating expenses increased by 21.9% to RMB4.1 billion (US$0.6 billion) in Q1 2024 from RMB3.4 billion in Q1 2023, driven by a 24.5% increase in general and administrative expenses and a 25.5% increase in sales and marketing expenses[28]. - Gross profit decreased by 35.1% to RMB4.1 billion (US$0.6 billion) in Q1 2024 from RMB6.3 billion in Q1 2023, with a gross margin of 25.2% compared to 31.3% in the same period last year[27]. - Income from operations was RMB12 million (US$2 million) in Q1 2024, down from RMB2,978 million in Q1 2023, resulting in an operating margin of 0.1% compared to 14.7% in the same period last year[31]. - Adjusted income from operations was RMB960 million (US$133 million) in Q1 2024, compared to RMB3,830 million in Q1 2023, with an adjusted operating margin of 5.9% versus 18.9% in the same period last year[32]. Shareholder Returns and Repurchases - The company allocated approximately US$220 million to share repurchases in Q1 2024, emphasizing its commitment to enhancing shareholder returns[14]. - The company has established a share repurchase program allowing for the purchase of up to US$2 billion of its Class A ordinary shares and/or ADSs until August 31, 2024, with approximately 76.6 million ADSs purchased for a total consideration of approximately US$1,129.8 million[44]. Cash and Assets - As of March 31, 2024, the combined balance of cash, cash equivalents, restricted cash, and short-term investments amounted to RMB60.8 billion (US$8.4 billion)[39]. - The company's cash and cash equivalents decreased to RMB 17,845,299 thousand from RMB 19,634,716 thousand over the same period[59]. - KE Holdings Inc. reported a decrease in total shareholders' equity to RMB 69,124,976 thousand as of March 31, 2024, down from RMB 72,201,105 thousand as of December 31, 2023[65]. - The company’s accumulated deficit improved slightly from RMB (5,672,916) thousand to RMB (5,241,142) thousand, indicating a reduction in losses[65]. - The total current assets increased to RMB 70,543,525 thousand as of March 31, 2024, from RMB 69,753,623 thousand as of December 31, 2023, showing a growth of approximately 1.1%[59]. User Engagement - Mobile monthly active users (MAU) averaged 47.7 million in Q1 2024, up from 45.4 million in the same period of 2023[5]. - The weighted average number of ordinary shares used in computing net income per share, basic and diluted, was 3,439,606,429 for the three months ended March 31, 2024[74]. Foreign Currency and Cash Flow - The company experienced a foreign currency exchange loss of RMB 17,748 for the three months ended March 31, 2024, compared to a gain of RMB 34,707 in the previous year[68]. - The company experienced a net cash used in operating activities of RMB 915,276 for the three months ended March 31, 2024, compared to a net cash provided by operating activities of RMB 7,627,833 in the same period of 2023[81]. - KE Holdings Inc. had cash, cash equivalents, and restricted cash of RMB 24,783,312 at the end of the period on March 31, 2024, down from RMB 38,454,355 at the end of the same period in 2023[81].

Investment Rating - The report maintains a "Buy" rating for Ke Holdings with a target price adjusted to $22.00 from the previous $23.00, reflecting a potential upside of 16.6% from the current price of $18.87 [2][3]. Core Insights - The report highlights a rebound in sentiment and a gradual recovery in the fundamentals of Ke Holdings, despite a 19% year-over-year decline in revenue to RMB 16.4 billion in Q1 2024. This decline was less severe than expected, aided by stronger-than-anticipated growth in new business revenues [2][6]. - The existing home transaction (EHT) gross transaction value (GTV) fell by 32% year-over-year to RMB 453 billion, while new home transaction (NHT) GTV dropped 45% to RMB 152 billion. However, the report anticipates a recovery in GTV starting in Q2 2024, driven by supportive policies [2][6]. - New business segments, particularly home renovation and furniture, showed significant growth, with revenues reaching RMB 2.4 billion in Q1 2024, a 71% increase year-over-year. The management expects operational efficiency to improve in 2024, leading to a reduction in net loss margins from -10% in 2023 to -5% in 2024 [2][6]. Financial Summary - For FY24E, total revenue is projected to be RMB 90.2 billion, reflecting a 15.9% year-over-year growth. Adjusted net profit is expected to be RMB 9.4 billion, with a decrease of 13.1% compared to the previous year [7][9]. - The report outlines a gradual improvement in profitability metrics, with gross profit margins expected to stabilize around 26.1% in FY24E, while operating profit margins are projected at 5.6% [9][10]. - The company has committed to enhancing shareholder returns, having allocated $220 million for stock buybacks in Q1 2024, representing approximately 1% of its market capitalization [2][6]. Market Outlook - The report suggests that recent policy changes regarding down payment ratios and mortgage rates may stimulate real estate sales, although challenges remain due to high housing inventory and a long-term demographic outlook that may not support significant price recovery [2][6]. - The anticipated total GMV for Ke Holdings in Q2 2024 is projected at RMB 79.6 billion, with a 2% year-over-year increase, and total revenue expected to reach RMB 21.5 billion, a 10% increase [2][6].

Investment Rating - Maintain BUY rating for Beike with a target price of US$22.00, down from the previous US$23.00, indicating a potential upside of 16.6% from the current price of US$18.87 [2][3]. Core Insights - Beike reported a 19% year-over-year decline in revenue for Q1 2024, totaling RMB16.4 billion, but this was better than both the forecast and consensus estimates due to strong performance in new business segments [2]. - The company is expected to see growth in Gross Transaction Value (GTV) starting from Q2 2024, driven by supportive policies and a rebound in market sentiment [2]. - Beike's core business continues to gain market share, supported by its established ACN ecosystem, while new business areas like home renovation and rental services are growing rapidly [2]. - The management has committed approximately US$220 million for share repurchase, representing about 1% of the market cap, to enhance shareholder returns [2]. Financial Performance - In Q1 2024, Beike's existing home transaction GTV fell 32% year-over-year to RMB453 billion, while new home transactions dropped 45% to RMB152 billion, compared to a 50% decline for the top 100 developers [2]. - The company generated RMB2.4 billion in revenue from home renovation and furnishing, marking a 71% year-over-year increase [2]. - Forecasts for Q2 2024 include total GTV of RMB796 billion, up 2% year-over-year, and total revenue of RMB21.5 billion, up 10% year-over-year [2]. Earnings Summary - Revenue projections for Beike are set to increase from RMB77.8 billion in FY23 to RMB90.2 billion in FY24, reflecting a year-over-year growth of 15.9% [6]. - Adjusted net profit is expected to reach RMB6.9 billion in FY24, down from RMB10.8 billion in FY23, indicating a decline of 13.1% [6]. - The company anticipates a gradual recovery in profitability, with adjusted net profit margins stabilizing around 10.4% in FY24 [8]. Market Outlook - Recent policy changes regarding down payment ratios and mortgage interest rates are expected to provide a marginal boost to property sales, although the impact may be less significant than in previous downturns [2]. - The overall property market is projected to show positive signs of recovery in the latter half of 2024, supported by demand-side easing and financing policy implementations [5].

Core Insights - KE Holdings Inc. (BEKE) has reached an important support level and is considered a good stock pick from a technical perspective due to a recent "golden cross" event [1] - The golden cross indicates a bullish breakout, occurring when the 50-day simple moving average surpasses the 200-day simple moving average, which is a strong indicator of potential upward momentum [1] - BEKE's shares have increased by 37.4% over the past four weeks, and the company holds a 1 (Strong Buy) rating on the Zacks Rank, suggesting a favorable outlook for further price appreciation [1] Technical Analysis - A golden cross consists of three stages: the stock price bottoms out, the shorter moving average crosses above the longer moving average, and the stock maintains upward momentum [1] - The golden cross is contrasted with a death cross, which signals potential bearish price movement [1] Earnings Outlook - The positive earnings outlook for BEKE further supports the bullish case, as no earnings estimates have been cut for the current quarter [1]

Core Viewpoint - KE Holdings Inc. reported a significant decline in gross transaction value and net revenues for the first quarter of 2024, reflecting challenges in the housing market while also highlighting growth in home renovation and rental services [2][7][10]. Financial Performance - Gross transaction value (GTV) decreased by 35.2% year-over-year to RMB629.9 billion (US$87.2 billion) [2][7]. - Net revenues fell by 19.2% year-over-year to RMB16.4 billion (US$2.3 billion) [7][19]. - Net income was RMB432 million (US$60 million), a decrease from RMB2,750 million in the same period of 2023 [19][20]. - Adjusted net income was RMB1,392 million (US$193 million), down from RMB3,561 million year-over-year [19][20]. Segment Performance - Existing home transaction services GTV decreased by 31.8% to RMB453.2 billion (US$62.8 billion) [2][8]. - New home transaction services GTV dropped by 45.4% to RMB151.8 billion (US$21.0 billion) [2][10]. - Home renovation and furnishing revenues increased by 71.1% to RMB2.4 billion (US$0.3 billion) [11]. - Home rental services revenues surged by 189.3% to RMB2.6 billion (US$0.4 billion) [11]. Operational Metrics - The number of stores increased by 7.1% year-over-year to 44,216 [2]. - Active agents decreased by 3.0% year-over-year to 399,159 [2]. - Mobile monthly active users averaged 47.7 million, up from 45.4 million in the same period of 2023 [2]. Strategic Initiatives - The company is focusing on enhancing customer experience and service capabilities through innovative approaches such as short videos and live streaming [3]. - A "one body, three wings" strategy is being implemented to adapt to the evolving market environment [5]. Shareholder Returns - Approximately US$220 million was allocated to share repurchases in the first quarter [6][25]. - The company aims to provide sustained returns to shareholders while optimizing capital allocation [6]. Cash Position - As of March 31, 2024, the combined balance of cash, cash equivalents, restricted cash, and short-term investments was RMB60.8 billion (US$8.4 billion) [21]. Business Line Changes - The company has begun separately reporting financials for home rental services to provide better insight into revenue structure and margin trends [22][23].

Group 1 - KE Holdings Inc. Sponsored ADR (BEKE) has gained approximately 16.7% year-to-date, outperforming the Finance sector average gain of 5.1% [2][3] - The Zacks Consensus Estimate for BEKE's full-year earnings has increased by 18.8% over the past three months, indicating improved analyst sentiment [2] - KE Holdings Inc. is ranked 1 (Strong Buy) in the Zacks Rank system, which focuses on earnings estimates and revisions [2] Group 2 - KE Holdings Inc. is part of the Real Estate - Operations industry, which consists of 38 stocks and is currently ranked 91 in the Zacks Industry Rank [3] - The Real Estate - Operations industry has an average year-to-date gain of 3.3%, showing that BEKE is performing better than its industry peers [3] - BrightSphere Investment Group (BSIG), another Finance stock, has returned 16.4% year-to-date and is also ranked 1 (Strong Buy) [2][3]

Core Viewpoint - KE Holdings Inc. will report its unaudited financial results for Q1 2024 on May 23, 2024, before the U.S. market opens [1] Group 1: Financial Results Announcement - The earnings conference call is scheduled for 8:00 A.M. Eastern Time on May 23, 2024 [1] - Participants must register online at least 20 minutes prior to the call to receive dial-in numbers and access information [1] Group 2: Company Overview - KE Holdings Inc. is a leading integrated online and offline platform for housing transactions and services in China [3] - The company operates Lianjia, a prominent real estate brokerage brand, and has over 22 years of experience since its inception in 2001 [3] - The company aims to build infrastructure and standards to enhance the efficiency of housing transactions and services [3]