Summary of Futu Holdings (FUTU) Earnings Review Company Overview - **Company**: Futu Holdings (FUTU) - **Market Capitalization**: $23.5 billion - **Current Price**: $168.52 - **12-Month Price Target**: $137.94 - **Downside Potential**: 18.1% [1][6][17] Key Financial Metrics - **Revenue Estimates**: - 2025E: HK$ 19,778.8 million (up from HK$ 17,689.6 million) - 2026E: HK$ 18,744.6 million (up from HK$ 17,792.8 million) - 2027E: HK$ 19,276.0 million [7][18] - **Net Income Estimates**: - 2025E: HK$ 9,097.9 million - 2026E: HK$ 7,879.4 million - 2027E: HK$ 7,981.3 million [7][18] - **Earnings Per Share (EPS)**: - 2025E: HK$ 65.33 - 2026E: HK$ 56.58 [7][18] Growth and Performance Insights - **Client AUM Growth**: - Revised estimates for 2025E/26E client AUM growth of +5%/+6%, indicating year-over-year growth of 37%/12% [2] - **Operating Expenses**: - Operating expenses for 2025E/26E revised down by -3% on average, reflecting strong performance in Q2 [3] - **New Initiatives**: - Launch of virtual asset trading in the US, HK, and SG, with a total virtual asset balance of HK$ 4 billion and peak daily trading size of US$ 40 million in July [4] - Significant improvement in Japan market penetration with a 50% quarter-over-quarter increase in trading volume in Q2 [4] Market and Valuation Considerations - **Valuation Multiples**: - P/E ratio for 2025E: 20.1x - P/B ratio for 2025E: 4.9x [12][19] - **Risks**: - Upside risks include better-than-expected growth in paying clients and AUM, while downside risks involve weaker-than-expected growth in these areas [20][21] Conclusion - The company maintains a **Neutral** rating due to rich valuation despite positive growth indicators and strategic initiatives. The price target has been adjusted upward by 10% from the previous target of US$ 124.89 to US$ 137.94 [1][17][20]

Summary of Futu Holdings (FUTU) 4Q24 Preview Conference Call Company Overview - **Company**: Futu Holdings (FUTU) - **Market Cap**: $16.7 billion - **Industry**: China Brokers & Asset Management Key Financial Projections - **4Q24 Revenue Growth**: Expected to grow by 48% year-over-year (yoy) to HK$3.5 billion - **4Q24 Profit Growth**: Expected to grow by 55% yoy to HK$1.4 billion - **2024 Revenue**: Projected at HK$12.5 billion, representing a 25% yoy increase - **2024 Profit**: Projected at HK$4.9 billion, representing a 15% yoy increase - **2025 Revenue**: Expected to reach HK$15.9 billion, an 8% increase compared to consensus - **2025 Profit**: Expected to reach HK$6.9 billion, an 8% increase compared to consensus - **Target Price**: Revised to US$123.54, implying a 2% upside from the current price of US$121.09 Client and AUM Growth - **New Paying Clients in 2025**: Projected to be 361,000, a 15% yoy increase - **Assets Under Management (AUM) in 2025**: Expected to reach HK$840 billion, a 16% yoy increase - **4Q24 AUM Growth**: Anticipated to increase by 48% yoy and 4% quarter-over-quarter (qoq) Market Dynamics - **Impact of Stimulus Policies**: The market has performed strongly since the stimulus policies introduced in September 2024, with the Hang Seng Index rising by 29% and the Hang Seng Tech Index by 56% - **Trading Volume**: Hong Kong stock trading volume has contributed 30% of total turnover over the three-year average, with average daily trading volume (ADTV) increasing to HK$180 billion from HK$110 billion Revenue Drivers - **Commission Income**: Expected to benefit from increased trading activity in the Hong Kong market - **Interest Income**: Minimal impact from Federal Reserve rate cuts anticipated, with margin financing and securities lending expected to grow by 44% and 31% yoy in 4Q24 and 2025, respectively Cost Management - **Cost-to-Income Ratio (CIR)**: Projected to decline from 41% in 2024 to 38% in 2025, contributing to EPS growth - **Cost Control Measures**: No plans for market expansion in 2025, which will reduce market expansion expenses Risks and Considerations - **Upside Risks**: Better-than-expected growth in paying clients, AUM, stock market capitalization, and trading volume - **Downside Risks**: Weaker-than-expected growth in paying clients and AUM, stock market decline, and lower trading activity Conclusion - **Rating**: Neutral - **Valuation**: Target P/E maintained at 18x, reflecting limited upside due to ongoing regulatory challenges in the China onshore business This summary encapsulates the key points from the conference call regarding Futu Holdings, focusing on financial projections, market dynamics, revenue drivers, cost management, and associated risks.