KE Holdings Inc. (NYSE: BEKE), a leading integrated online and offline platform for housing transactions and services in China, saw its stock plummet 5.19% in pre-market trading on Thursday. The sharp decline comes on the heels of the company's recently released disappointing earnings report and amid broader weakness in Chinese stocks.
The real estate technology company reported a significant drop in net income for both the fourth quarter and full-year 2024, despite posting revenue growth. Net income for Q4 2024 fell 13.9% year-over-year to RMB577 million, while full-year net income declined by 30.7% to RMB4.078 billion. These results fell short of analyst expectations, with earnings per share of CN¥3.45 missing forecasts by 17%.
Adding to investor concerns, analysts have revised their outlook for KE Holdings following the earnings release. While revenue forecasts for 2025 were slightly upgraded to CN¥104.4 billion, representing a 12% year-over-year increase, earnings per share expectations were significantly reduced. The consensus EPS forecast for 2025 now stands at CN¥4.98, down from the previous estimate of CN¥5.90. This adjustment suggests that analysts anticipate continued pressure on the company's profitability despite top-line growth.
The negative sentiment surrounding KE Holdings is further exacerbated by the overall weakness in Chinese stocks. Several Chinese ADRs and ETFs have been falling in pre-market trading, with some experiencing declines of 4% or more. This broader market trend, influenced by factors such as ongoing trade tensions and regulatory concerns, is likely contributing to the downward pressure on BEKE's stock price.
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