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Futu Holdings Ltd (FUTU)
NASDAQ:FUTU
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Futu Holdings
(NASDAQ:FUTU)
Rating:81Outperform
Price Target:
$130.00
▲(16.59%Upside)
Positive Factors
Expansion and Market Presence
Futu announced its entry into New Zealand, expecting high ROI by leveraging existing resources and brand equity.
Revenue and Profit Growth
Futu is expected to achieve another record high in revenue and profit, with significant year-on-year growth.
Trading Activity
Strong inflows and active trading are expected to lead to another record quarter for Futu.
Negative Factors
Client Acquisition Costs
There is concern about the sustainability of the lower new client acquisition cost in a volatile market.
Interest Rates Impact
Declining HIBOR rates are anticipated to negatively impact Futu's pre-tax operating profit if they persist.
Market Volatility
Increasing market volatility is expected to impact client assets under management and turnover, affecting FUTU's earnings.
Futu Holdings (FUTU) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.96B
Dividend YieldN/A
Average Volume (3M)2.13M
Price to Earnings (P/E)18.6
Beta (1Y)1.37
Revenue Growth56.04%
EPS Growth58.58%
CountryUS
Employees3,343
SectorFinancial
Sector Strength73
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)1.96
Shares Outstanding94,783,490
10 Day Avg. Volume1,990,626
30 Day Avg. Volume2,132,404
Financial Highlights & Ratios
PEG Ratio-1.71
Price to Book (P/B)3.53
Price to Sales (P/S)0.00
P/FCF Ratio4.86
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$133.10Price Target Upside19.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
Futu Holdings Business Overview & Revenue Model
Company DescriptionFutu Holdings Limited (FUTU) is a leading digital brokerage and wealth management platform primarily operating in Hong Kong. The company offers a comprehensive suite of financial services, including securities trading, margin financing, wealth management, and market data services. Futu leverages its innovative digital platform to provide a seamless and user-friendly experience for its clients, which includes retail investors and institutional clients across various global markets.
How the Company Makes MoneyFutu Holdings generates revenue through multiple streams, primarily derived from its brokerage and wealth management services. The company charges commission fees on securities trading executed through its platform, which represents a significant portion of its income. Additionally, Futu earns interest income from margin financing services provided to its clients who borrow funds to trade securities. The company also offers subscription-based market data services and earns asset management fees from its wealth management services. Partnerships with financial institutions and technology companies further enhance Futu's offerings, allowing it to expand its client base and increase revenue opportunities by providing advanced trading tools and financial products.
Futu Holdings Earnings Call Summary
Earnings Call Date:May 29, 2025
(Q1-2025)
| % Change Since: 3.52%|
Next Earnings Date:Sep 02, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong performance for Futu Holdings with significant growth in funded accounts, revenue, and client assets driven by strategic initiatives and favorable market conditions. Despite some challenges such as increased operating expenses and interest rate impacts, the company shows robust growth potential and confidence in achieving its annual targets.Q1-2025 Updates
Positive Updates
Record New Funded Accounts
Futu Holdings added approximately 262,000 new funded accounts in Q1 2025, representing a 48% increase year-over-year and a 22% increase quarter-over-quarter. The total funded accounts reached 2.7 million, up 42% from a year ago.
Strong Revenue Growth
Total revenue for Q1 2025 was HKD 4.7 billion, marking an 81% increase from HKD 2.6 billion in Q1 2024. Brokerage commission and handling charge income increased by 113% year-over-year.
Total Client Assets Surge
Total client assets reached HKD 830 billion, up 60% year-over-year and 12% quarter-over-quarter, driven by record net asset inflow.
Introduction of Futubull AI
Futubull AI, a smart investment assistant, was launched with a satisfaction rate of around 90% and plans to expand to international markets in Q2.
Increased Trading Volume
Total trading volume reached HKD 3.22 trillion in Q1 2025, up 140% year-over-year, with U.S. equity trading rising 8% sequentially.
Wealth Management Growth
Wealth management plan assets grew to HKD 139.2 billion, up 118% year-over-year and 26% quarter-over-quarter.
Negative Updates
Interest Rate Impact on Income
The recent decline in HIBOR may affect net interest income, although the impact is expected to be mitigated by increased trading activities.
Increased Operating Expenses
Total operating expenses increased by 36% year-over-year, with significant increases in R&D, selling and marketing, and G&A expenses.
Challenges in Crypto Trading
Crypto prices experienced a pullback affecting investor enthusiasm, although the company remains optimistic about long-term potential.
Company Guidance
During the first quarter of 2025, Futu Holdings demonstrated robust growth with key metrics reflecting strong performance. The company added approximately 262,000 new funded accounts, marking a 48% year-over-year and 22% quarter-over-quarter increase, bringing the total to 2.7 million accounts. This growth aligns with their annual target of 800,000 net new funded accounts. Total client assets surged to HKD 830 billion, a 60% year-over-year and 12% quarter-over-quarter rise, driven by record net asset inflow and a rally in Hong Kong equities. Additionally, total trading volume reached HKD 3.22 trillion, up 140% year-over-year and 11% quarter-over-quarter. The introduction of Futubull AI, a smart investment assistant, received a satisfaction rate of about 90%, highlighting its effectiveness. Financially, Futu reported a total revenue of HKD 4.7 billion, an 81% increase from the previous year, with net income rising by 107% year-over-year to HKD 2.1 billion, reflecting a net income margin of 45.6%. These metrics underscore Futu's strategic growth and market expansion trajectory for 2025.Futu Holdings Financial Statement Overview
Summary
Futu Holdings shows strong revenue growth and profitability with high margins and an excellent balance sheet featuring no debt. However, cash flow inconsistencies suggest challenges in cash management.Income Statement
Futu Holdings has demonstrated strong revenue growth, with Total Revenue increasing significantly over the years. The Gross Profit Margin remains high at 100% for 2024, indicating effective cost management. Net Profit Margin has also improved, reaching 45.5% in 2024 from 47.05% in 2023. The EBIT Margin is robust at 55.3% for 2024. However, the absence of EBITDA data in 2024 slightly limits the full profitability assessment.85
Very Positive
Balance Sheet
The company maintains a strong equity position with Stockholders' Equity steadily rising. The Debt-to-Equity Ratio is favorable at 0, indicating no debt burden. The Return on Equity (ROE) is impressive, rising to 19.4% in 2024, suggesting efficient use of equity. Equity Ratio stands at 17.5% for 2024, reflecting a balanced asset structure. The lack of debt enhances financial stability but also limits leverage for potential growth.78
Positive
Cash Flow
Cash flow performance is mixed. The Free Cash Flow has fluctuated, showing significant declines in recent years. The Operating Cash Flow to Net Income Ratio is unavailable for 2024, limiting insight into cash conversion efficiency. The Free Cash Flow to Net Income Ratio is also not calculable due to missing data, indicating potential challenges in cash management.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 13.59B | 9.10B | 7.32B | 6.74B | 3.13B | Gross Profit |
| 11.14B | 7.56B | 6.33B | 5.53B | 2.43B | EBIT |
| 6.62B | 5.01B | 3.48B | 3.19B | 1.45B | EBITDA |
| 6.80B | 5.18B | 3.63B | 3.31B | 1.53B | Net Income Common Stockholders |
| 5.44B | 4.28B | 2.93B | 2.81B | 1.33B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 14.42B | 4.94B | 5.03B | 5.72B | 1.33B | Total Assets |
| 159.70B | 97.14B | 94.50B | 101.54B | 71.34B | Total Debt |
| 8.55B | 5.89B | 2.69B | 11.09B | 11.16B | Net Debt |
| -3.13B | 952.04M | -2.34B | 6.53B | 9.82B | Total Liabilities |
| 131.70B | 72.56B | 73.64B | 80.55B | 63.03B | Stockholders Equity |
| 28.01B | 24.57B | 20.86B | 20.99B | 8.31B |
| Cash Flow | Free Cash Flow | |||
| 30.83B | -6.42B | 3.38B | 5.94B | 20.41B | Operating Cash Flow |
| 31.00B | -6.34B | 3.47B | 6.01B | 20.46B | Investing Cash Flow |
| 103.93M | -2.44B | 93.86M | -963.57M | -244.18M | Financing Cash Flow |
| 70.85M | 2.31B | -7.01B | 10.55B | 8.41B |
Futu Holdings Technical Analysis
Positive
111.50
Price Trends
98.57
Positive
103.13
Positive
93.49
Positive
Market Momentum
2.64
Negative
56.33
Neutral
75.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FUTU, the sentiment is Positive. The current price of 111.5 is above the 20-day moving average (MA) of 108.73, above the 50-day MA of 98.57, and above the 200-day MA of 93.49, indicating a bullish trend. The MACD of 2.64 indicates Negative momentum. The RSI at 56.33 is Neutral, neither overbought nor oversold. The STOCH value of 75.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FUTU.
Futu Holdings Risk Analysis
Futu Holdings disclosed 98 risk factors in its most recent earnings report. Futu Holdings reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Futu Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $4.96B | 18.61 | 23.44% | ― | 56.04% | 58.58% | |
81 Outperform | $85.43B | 27.90 | 19.26% | 0.63% | 14.67% | 23.59% | |
78 Outperform | $10.35B | 12.56 | 21.71% | 3.31% | -2.79% | 1.33% | |
75 Outperform | $8.45B | 39.12 | 16.25% | 1.35% | 7.22% | -15.53% | |
71 Outperform | $211.64B | 15.19 | 13.88% | 2.86% | 6.53% | 55.54% | |
68 Neutral | $1.47B | 18.64 | 13.18% | ― | 52.63% | 96.46% | |
64 Neutral | $12.77B | 9.71 | 7.85% | 78.06% | 12.07% | -7.97% |
* Financial Sector Average
Performance Comparison
FUTU
Futu Holdings
111.50
44.00
65.19%
IBKR
Interactive Brokers
202.16
81.83
68.00%
MKTX
Marketaxess Holdings
225.25
28.53
14.50%
MS
Morgan Stanley
129.49
35.45
37.70%
TIGR
Up Fintech Holding
8.31
4.02
93.71%
XP
XP
19.64
3.40
20.94%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.