JPMorgan Initiates SHEIN-W with Overweight Rating, Target Price HK$50

Stock News10:30

JPMorgan has released a research report initiating coverage on SHEIN-W (00625) with an "Overweight" rating, setting a target price of HK$50 by the end of 2027.

The bank noted that SHEIN's share price has pulled back 29% since its IPO, while the Hang Seng Index declined 5% over the same period. Although the stock faces short-term pressure, this trough is only temporary.

JPMorgan stated that SHEIN has continued to add new customers and maintain order growth despite adjustments to U.S. tariffs and Middle East conflicts. As costs related to Middle East conflicts subside and its EU business shifts toward local stocking, revenue is expected to stabilize starting from the fourth quarter, with profitability beginning to recover in the first quarter of 2027.

The bank forecasts the company's adjusted net profit to reach US$985 million this year and US$1.97 billion in 2027. The target price corresponds to 9 times the 2027 forecast price-to-earnings ratio plus cash value. JPMorgan believes the market is assigning quite limited value to the company's operating business and expects valuation multiples to remain at low levels.

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