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Research Alert: CFRA Keeps Hold Opinion On Adss Of Joyy Inc
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Research Alert: CFRA Keeps Hold Opinion On Adss Of Joyy Inc
May 29, 2024 2:30 AM

05:00 AM EDT, 05/29/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

Following JOYY's ( YY ) lower-than-expected Q1 2024 earnings, we cut our projected earnings per ADS for 2024/2025 to USD3.78/USD4.11 (from USD5.96/USD7.11), as we assume slower revenue growth and cost-outs. Our 12-month target price is cut to USD35 (from USD37), at 9.3x our projected 2024 earnings and a discount to its 3-year TTM average P/E of 15x. We believe this is appropriate given continuing uncertainties from the proposed cancelation of the acquisition of its former YY business by Baidu. We note that almost 25% of its cash balance is currently tied to the acquisition, being a share of the consideration received. In Q1 2024, revenue -3%, on lower live-streaming revenue as JOYY ( YY ) phased out non-core products for Bigo Live. Other revenues surged +55% on growth for the ads business. Operating income +40% to USD3.5 mln, as lower gross profit (-5%, higher revenue sharing fees) are offset by lower opex (-5%, from lower sales and R&D costs). JOYY ( YY ) expects revenue to be sequentially flat at best in Q2.

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