Why the Futu and Tiger Brokers plunge

Alice Arnault
2023-05-16

$Futu Holdings Limited(FUTU)$ $Tiger Brokers(TIGR)$ Fumi 

This is quite a interesting one today as futu and tiger brokers have plunged more than 50percent.

Why?

This is largely related to the risk of losing customers in mainland china as a result of increased pressure from the authorities reported in WSJ

Impact?

Hard to estimate but can be significant for a while. The annual reports do state this risk but the exact revenue breakdown and user breakdown is unknown but nevertheless it will be a disturbance to the companies performance 

Hypothesis testing 

Would be great to compare this with fumi but that is a privately held entity.

Chance to purchase ?

This might be a purchase on the dip but this will still be dependant on one's analysis of the other fundamentals 

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Comments

  • Im positive
    2023-05-17
    Im positive
    so u will sell on continue hold?
  • pixiezz
    2023-05-18
    pixiezz

    Solid earnings growth, excellent eps, a positive current and quick ratio and much more. Stuck on the 40-50 price mark but once it breaks the 50 I see it rising to 70. A great hold for the long term

  • frosti
    2023-05-18
    frosti

    I'm still bullish on Chinese tech, because I expect consumer demand to recover H2 2024, stimulus from the Chinese government will take some months to take effect. Also, many Chinese stocks are still trading at a tremendous discount considering their fundamentals.

  • frosti
    2023-05-18
    frosti

    i sold at 50 before it got to 60. market is forward looking, I just look deeper and further then the market.

  • wigglyz
    2023-05-18
    wigglyz

    bought at 30 sold at 50. will buy at 24

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