On July 31, after the market close, MEDTIDE (03880) issued a profit warning for its 26H1 fiscal year. The company expects period revenue of approximately RMB 229.8-239.2 million, a year-over-year decrease of about 5.7-9.4%; net profit of approximately RMB 49.4-57.1 million, a year-over-year decrease of about 44.0-51.6%; and adjusted net profit down by about 43.1-50.6% year-over-year.
Observations show that MEDTIDE's stock price began a technical pullback on July 16 after hitting a 26-day high of HKD 25 and the upper Bollinger Band on July 15. By the close of July 31, the stock was still fluctuating near the middle Bollinger Band. However, after the profit warning revealing a significant net profit decline, selling pressure noticeably increased. On August 3 and 4, the stock logged two consecutive long bearish candles, dropping a cumulative 11.20%, nearly erasing its gains from early June.
Profit Warning and Flat-Volume Decline
Despite the apparent sharp volatility, including a six-day losing streak and long bearish candles, trading volume remained stable under the surface. Data shows that during the four trading days around the profit warning disclosure (July 29 to August 3), daily stock volumes were 104,400 shares, 101,600 shares, 101,100 shares, and 108,500 shares, respectively. Even on August 4, when the stock fell sharply, volume was only 121,300 shares. This price decline on flat volume suggests that major funds did not panic-sell due to the profit warning.
In the warning, MEDTIDE attributed the performance changes to several factors. Revenue fell due to timing differences in revenue recognition: deliveries and revenue recognition for some customer orders are expected to be delayed to the second half of 2026, causing a temporary mid-year drop. The profit decline was mainly due to foreign exchange losses from the appreciation of the renminbi against the US dollar on cash and trade receivables, the disappearance of a non-recurring gain, and a year-over-year decline in sales revenue leading to lower gross profit. The company emphasized that these mid-year fluctuations do not impact its core business strength or long-term prospects. It noted that deeper collaboration with clients and pipeline progress, including securing a large overseas order in July 2026, have strengthened its order backlog.
From a chart perspective, during the recent decline, while the stock price has been falling, volume has remained consistent without a sharp spike, indicating that major funds have not been dumping shares but are passively absorbing floating supply. Comparing the shareholder structure on August 5 with that on June 5, it is clear that although the stock formed an M-shaped pattern over two months, major funds have been locked in at the low range of HKD 21-22, below the average cost of shares. In contrast, the structure above the cost line has shifted significantly, with most holders who bought above HKD 27 choosing to cut losses, pushing total shares toward the average cost line.
Currently, after several days of flat-volume bottoming, the stock price continues to hit new lows as of August 5, indicating that bearish momentum has not yet been exhausted. The stock has not yet seen consecutive days of higher lows to end the downtrend, and key volume moving averages have not yet shown a clear inflection point. Typically, without incremental capital tentatively entering the market, investors need to wait for increased market attention and a shift from cold to warm sentiment.
Can the Stock Rebound on the Hong Kong CXO Rally?
Recently, Hong Kong-listed healthcare concept stocks have broadly rallied, with the CXO and innovative drug sectors surging, driving the Hang Seng Healthcare Index into a strong rebound. The index rose 2.02% and 1.18% on August 4 and 5, respectively. The Hong Kong-listed healthcare sector actually began to recover from late June, primarily driven by better-than-expected results from CXO leaders boosting sector sentiment, lifting innovative drugs and medical devices in tandem.
For example, on August 4, the Hong Kong CXO sector saw a broad rally, with WuXi AppTec surging 11.17%, and Pharmaron and Tigermed both rising over 5%. This positive market response was supported by strong earnings from CXO leaders. WuXi AppTec reported record Q2 revenue and profit, raised its full-year guidance, and declared an interim dividend of RMB 1.506 billion, confirming a recovery in global pharma R&D demand. Pharmaron showed a 30%+ growth in new orders, directly reflecting the sector's high prosperity.
From the interim results of Hong Kong CXO leaders, it is clear that the sector has the foundation for a medium-to-long-term value re-rating. However, a broad-based rally is unlikely to persist, and divergence within the sector may lead to a more volatile, upward-trending structural market. The sustainability of CXO orders will be a key differentiator for investors.
In the peptide sub-sector, data from Cognitive Market Research shows the global peptide API market was approximately USD 9.60 billion in 2025, expected to grow at a CAGR of 23.50% from 2025 to 2033. Rising R&D interest in innovative peptide drugs is expected to boost related outsourcing demand. Frost & Sullivan estimates the global GLP-1 drug market grew from USD 9.3 billion in 2018 to USD 38.9 billion in 2023, a CAGR of 33.2%, and is projected to reach USD 129.9 billion by 2032. China's GLP-1 market grew from USD 100 million in 2018 to USD 1.3 billion in 2023, a CAGR of 65.3%, and is expected to reach USD 23.2 billion by 2032, a CAGR of 37.3%.
Beyond medium-to-long-term prospects, in the first half of 2026, Asymchem, a leading peptide CXO, reported that of 52 peptide clinical projects it served, 19 were related to weight loss. The company disclosed in its Q1 report that its target for solid-phase peptide synthesis capacity would increase significantly from 45,000 liters to 69,000 liters by year-end, a 53% expansion, matching the pace of growth in its order backlog.
For MEDTIDE, as the world's third-largest peptide CRDMO, it previously achieved FDA registration for its tirzepatide API and placed its semaglutide API on the FDA's green list. On July 31, the company completed a pre-license inspection (PLI) by the US FDA for its HEPCLUDEX® API. These business developments support the company's claim in the profit warning that "performance fluctuations do not impact its core business strength or long-term outlook."
Valuation and Potential for a Bounce
From a valuation perspective, after the consecutive stock price decline, MEDTIDE's latest PE valuation is only 12.43 times, far below the industry average of 23.34 times and about 17% lower than its three-month average PE. This current valuation is below the company's reasonable range. This suggests a potential short-term opportunity for an oversold rebound for this peptide CXO stock.
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