On March 19, LexinFintech Holdings Ltd. (LX.US), a leading new consumption digital technology service provider in China, released its financial results for the fourth quarter and full year of 2025. Alongside steady revenue, profit, and impressive user growth, a more notable detail emerged: the company announced the continuation and strengthening of its high dividend distribution policy. For the second half of 2025, a cash dividend of $0.188 per ADS will be paid, representing approximately 30% of net profit. This marks the third enhancement to shareholder returns by LexinFintech in nearly two years.
Looking back over the past two years, LexinFintech's dividend strategy has evolved from steady implementation to continuous upgrades, with each step reflecting the ongoing optimization of the company's operational quality and management's emphasis on shareholder returns. In the second half of 2024, LexinFintech explicitly set its dividend payout ratio at 20% of net profit for the first time, distributing $0.11 per ADS, which was more than 50% higher than the $0.072 per ADS paid in the first half of 2024, signaling the formal establishment of a regular dividend mechanism.
Entering 2025, the company continued to increase its dividend efforts. In the first half, the payout ratio was raised to 25%, with a distribution of $0.194 per ADS, a 76% increase compared to the second half of 2024, with the dividend amount accounting for about 25% of first-half net profit. In the second half, the ratio was further increased to 30%, establishing a clear rhythm of "semi-annual dividends with a steadily rising ratio," thereby continuously enhancing the certainty and richness of shareholder returns. Calculated for the full year 2025, the total dividend per share reached $0.382, more than double the $0.182 from the previous year.
Against the backdrop of heightened volatility in global capital markets and ongoing valuation divergence among US-listed Chinese stocks, LexinFintech's dividend upgrade is no coincidence but a direct reflection of its robust and ample cash flow. Financial report data shows the company's profit resilience, with Q4 2025 net profit attributable to the parent company reaching 299 million yuan and full-year net profit at 2.216 billion yuan. LexinFintech's cash and cash equivalents stood at 21.56 billion yuan in 2025, with net cash flow from operating activities exceeding 3 billion yuan, providing the most solid foundation for sustained dividends and ratio increases.
Based on this dividend analysis, as of March 20, LexinFintech's dividend yield reached 12.04%—meaning the entire investment cost could be recouped in less than nine years. This figure significantly exceeds the market average and is even higher than current US Treasury bond yields, forming a rare investment profile characterized by "high dividend yield and low valuation."
Behind the dividends lies LexinFintech's severely undervalued investment appeal. From a valuation perspective, as of March 19, 2026, the company's total market capitalization was only $429 million, with a trailing twelve-month (TTM) P/E ratio as low as 1.86 times and a P/B ratio of 0.246 times. These metrics are significantly below the average for the US-listed Chinese stock sector and even below the company's intrinsic operational value, marking it as a typical "value play."
This undervaluation stands in stark contrast to the company's solid operational fundamentals: LexinFintech boasts a substantial user base of 200 million registered users and 40 million credit-approved users. It has deeply implemented its "Low & Grow" strategy, leading to a continuous increase in the proportion of high-quality users. Meanwhile, the expansion of its e-commerce business and overseas markets provides new engines for performance, indicating considerable potential for future profit growth.
Historically, the market often viewed LexinFintech as a high-growth but highly volatile growth stock. Now, with the normalization of its dividend mechanism and the increasing payout ratio, its investment profile is undergoing a qualitative transformation—shifting from a pure growth narrative to a composite model of "steady development plus high dividend returns." Based on the current share price, if the 30% dividend payout ratio is maintained in 2026, LexinFintech's full-year dividend yield is projected to stabilize within the 8%–10% range. In the context of still-high global risk-free rates and a scarcity of quality high-yield assets, this level is highly attractive.
More importantly, LexinFintech is not "sacrificing growth for dividends." Its full-year 2025 transaction volume exceeded 205.3 billion yuan, its overseas business has gained initial scale in markets like Mexico and Indonesia, and its small and micro finance segment is opening a second growth curve.
LexinFintech's shareholder return strategy is not limited solely to dividends but encompasses a comprehensive "capital defense system" that includes dividends, share repurchases, and management share acquisitions. In addition to the 30% dividend payout ratio, LexinFintech is actively advancing its share repurchase program. As of March 18, 2026, approximately 80% of the company's repurchase plan had been completed, utilizing $39 million. Concurrently, management's personal share acquisition plans have been fully executed, with the chairman personally acquiring shares worth $10 million.
These counter-cyclical actions, implemented during a period of Q4 performance pressure and widespread industry pessimism, serve as a "dual confidence endorsement." On one hand, the company uses its own funds to support the share price, cushioning against valuation declines driven by regulatory uncertainties. On the other hand, it deeply aligns management interests with those of shareholders, dispelling market skepticism.
In summary, characteristics like those of LexinFintech—being "both profitable and willing to distribute profits"—are precisely the corporate qualities most valued by mature capital markets. Through its substantial and steadily increasing dividends, LexinFintech demonstrates that it is no longer an internet company burning cash for scale, but rather a fintech enterprise with strong free cash flow, a shareholder-oriented mindset, and a long-term vision.
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