JPMorgan analyst Daniel Chen downgraded Bilibili (BILI) to Underweight from Overweight with a $13 price target and introduces a long iQiyi (IQ)/short Bilibili pair trade within its online video sector coverage. While the firm remains positive on Bilibili’s strong user engagement among China Gen-Z users, it has become “incrementally cautious” on the company’s monetization outlook and notes that its 2023/24 revenue estimates are now 8% and 11% below consensus, respectively. Meanwhile, the firm reiterates its positive view on iQiyi with a price target of $11, which equates to 109% potential upside, given it is positive on iQiyi’s earnings growth in the next two to three years.
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