Rating Quick Look | Tesla's post-performance target price has been lowered! JD, Bilibili, and BIDU-SW also face "price cuts"

Morgan Stanley: Maintains "Overweight" rating on Tesla stock with a target price of $345

The bank stated that Tesla's performance and subsequent conference call did not provide any new information to change the current bearish sentiment. In fact, if Tesla fails to restore confidence in its growth prospects, the stock may continue to test lower recent trading levels.

The bank believes that the company has provided almost no details on its outlook for the next year. Although Tesla stated that sales in 2024 will "significantly decline" compared to last year, it did not specify the percentage. The bank expects Tesla's sales growth in 2024 to drop to 15%, less than half of the 38% growth rate in 2023.

Wells Fargo: Lowers Tesla's target price from $223 to $220

Goldman Sachs: Gives Tesla a "Neutral" rating with a target price of $255

Due to lower unit costs and improved Non-GAAP gross margin in the fourth quarter of last year, but Tesla did not provide specific guidance on this year's car sales and indicated that the growth rate may slow significantly.

Goldman Sachs believes that investors will hope to gain a better understanding of Tesla's car sales, profit margin trajectory, the bottoming position of profit margin, and the prospects of AI-related products during the conference call. If more specific information or guidance, especially on sales and profit margins, can be provided during the conference call, it may play a key role in the stock.

Morgan Stanley: Maintains "Equal-weight" rating on JD with a target price of $27, down from $30

The bank expects JD's performance in the fourth quarter of last year to meet expectations, with JD's retail revenue increasing by 1% YoY and operating profit margin decreasing by 44 basis points YoY to 2.6%. It believes that the intensified competition in the e-commerce industry this year will bring more uncertainty to JD's total transaction volume, revenue growth, and profitability.

The bank expects JD's total transaction volume to grow by 8% YoY this year, surpassing the overall retail sales in mainland China, and expects the company to increase investment to enhance user experience and attract new users, with net profit margin remaining roughly flat.

CICC: Lowers Bilibili's target price to HKD 101, maintains "Buy" rating

CICC maintains its expectations for user/revenue growth in the fourth quarter. The bank expects Bilibili's fourth-quarter traffic to increase by 10%, revenue to grow by 3% YoY, in line with market expectations, and expects gross margin to expand by 6 percentage points to 26%. It also expects adjusted net loss attributable to shareholders to narrow to CNY 580 million, continuing the trend from the same period last year.

CICC maintains its expectations for fourth-quarter mobile game revenue, which is expected to decrease by 6% YoY. It focuses on the exclusive distribution of new games "Blazing Skies" and "Three Kingdoms: Strategy to Rule the World," which have obtained licenses, and pays attention to their progress in going online.

Jefferies: Lowers Baidu's target price from $170 to $158

The bank expects Baidu to maintain stable growth in the fourth quarter of last year, with total core business revenue expected to grow by 8% YoY to CNY 27.7 billion, and profit margin to remain stable. Advertising revenue is expected to grow by 7% YoY, driven by steady growth in the healthcare and tourism industries, but partially offset by the shift of advertising spending on e-commerce platforms to price subsidies. Under the normalization of the base and the promotion of Gen-AI, cloud computing revenue is expected to recover with a quarterly growth of 11%.

In addition, the report points out that Baidu is increasing its efforts to optimize costs to offset higher investments in large language models (LLMs). The bank believes that this is a test for Gen-AI, which may contribute to revenue starting in 2024. Due to the uncertainty of chip supply, the bank has lowered its revenue forecast for 2024 and 2025 by about 1% and lowered the target price from $170 to $158. The annual free cash flow of approximately $4 billion can also support stock repurchases.

Macquarie: Maintains "Outperform" rating for New Oriental-S, raises target price from HKD 63.6 to HKD 70.2

The report states that New Oriental's non-GAAP operating margin increased by 3.3 percentage points YoY to 5.9% in the last quarter. The bank believes this is due to the increased utilization of learning centers, the operating leverage of teachers and fixed costs at the headquarters, the expansion of profit margins in new business segments, and the YoY increase in profit margins for overseas and university-related businesses. Based on the fact that the utilization rate of learning centers was only two-thirds last quarter, the bank believes that there is still room for profit margin expansion.

On the other hand, the operating margin of New Oriental's subsidiary, Dongfang Zhenxuan, decreased by 20 percentage points to 11% in the first half of the fiscal year, reflecting a greater expansion in the profit margin of the core education business.