Youdao upgraded to Outperform from Hold at Daiwa

Daiwa analyst Candis Chan upgraded Youdao to Outperform from Hold with a price target of $9.50, up from $4. The company’s Q4 results were better than expected due to digital content revenue growth and gross margins of learning services and smart devices, the analyst tells investors in a research note. The firm says Youdao’s margins are likely better than expected, creating operating breakeven in 2024, while generative artificial intelligence in the education field is "another rerating catalyst."