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Luckin Coffee
(OTC:LKNCY)
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Rating:77Outperform
Price Target:
$41.00
▲(14.53% Upside)
Action:Reiterated
Date:08/18/26
LKNCY scores well on a combination of strong underlying financial performance and very attractive valuation (low P/E), supported by constructive technical momentum (trading above key moving averages). The main constraints on the score are margin compression and mixed cash-flow conversion, plus near-term same-store sales and cost pressures noted on the earnings call.
Positive Factors
Scale and Market Position
Luckin’s expanding store network and partnership model strengthen purchasing, brand visibility and customer access. Greater scale can improve fulfillment efficiency and spread fixed costs, reinforcing its competitive position in China’s growing coffee market.
Negative Factors
Structural Cost Pressure
Higher materials, rent and payroll costs are absorbing more revenue as the footprint expands. If these expenses remain elevated, operating leverage will weaken and Luckin may need continued pricing, sourcing or productivity initiatives to protect profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Scale and Market Position
Luckin’s expanding store network and partnership model strengthen purchasing, brand visibility and customer access. Greater scale can improve fulfillment efficiency and spread fixed costs, reinforcing its competitive position in China’s growing coffee market.
Read all positive factors
Luckin Coffee (LKNCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.98B
Dividend YieldN/A
Average Volume (3M)1.40M
Price to Earnings (P/E)2.5
Beta (1Y)0.25
Revenue Growth40.80%
EPS Growth-0.80%
CountryUS
Employees106,447
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)94.56
Shares Outstanding269,267,180
10 Day Avg. Volume970,391
30 Day Avg. Volume1,398,485
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)0.55
Price to Sales (P/S)0.20
P/FCF Ratio2.77
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$44.93Price Target Upside25.51% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)14.7
Revenue Forecast (FY)$61.71B
Luckin Coffee Business Overview & Revenue Model
Company Description
Luckin Coffee Inc. operates as a prominent retailer of freshly prepared coffee and a variety of other beverages across the People's Republic of China. Their extensive product range encompasses both hot and iced brewed coffees, including classics l...
How the Company Makes Money
Luckin Coffee makes money primarily by selling products directly to consumers through its coffee shops and ordering channels. Its core revenue stream is the sale of freshly prepared beverages (especially coffee-based drinks), with additional reven...
Luckin Coffee Earnings Call Summary
Earnings Call Date:Aug 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 24, 2026
Earnings Call Sentiment Positive
The call presents robust top-line growth, rapid store expansion, strong customer momentum, improving absolute profitability and solid cash generation, offset by near-term same-store sales pressure from tough comps, rising input and operating costs, and increased marketing spend. Management frames the issues as expected results of subsidy normalization and intentional investments to support long-term share gains. Overall, positives (scale, revenue growth, product traction, cash generation, and absolute profit growth) outweigh the lowlights tied to margin mix and temporary comps.Positive Updates
Strong Top-Line Growth
Total net revenues of RMB 15.9 billion, up 29% year-over-year; GMV increased 30% YoY to RMB 18.4 billion.
Negative Updates
Same-Store Sales Pressure
Same-store sales for self-operated stores declined 5.3% YoY in Q2, attributed to a high comparison base from elevated delivery subsidies in the prior-year period; management expects continued high-base pressure into July-August.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Total net revenues of RMB 15.9 billion, up 29% year-over-year; GMV increased 30% YoY to RMB 18.4 billion.
Read all positive updates
Company Guidance
Management's guidance was cautiously constructive: they expect a persistent high base in 3Q from last year's elevated delivery subsidies (particularly July–August) even as delivery mix normalizes and fulfillment efficiency improves, which should support continued margin recovery; overall they remain cautiously optimistic about H2 while balancing growth and profitability. They pointed to Q2 momentum—net revenues RMB15.9bn (+29% YoY), GMV RMB18.4bn (+30%), GAAP operating profit RMB2.1bn (+22%, 13.4% margin), non‑GAAP operating profit RMB2.4bn (+26%, 15.1% margin) and net profit RMB1.5bn (+16%)—and emphasized operational levers: rapid store expansion (5,000+ net new stores in H1; Q2 adds 2,668 in China; global stores 36,310; international 223), customer growth (>25m new transacting customers in Q2; avg. monthly transacting customers >110m, +23% YoY; cumulative ~500m), improving delivery expense mix (delivery now ~10% of revenues vs. 14% prior), robust cash (cash position RMB10.9bn; net cash RMB9bn) and ongoing shareholder returns (repurchased 49m Class A shares/6m ADS for $195m).Luckin Coffee Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
67
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 55.64B | 47.95B | 34.96B | 24.90B | 13.53B | 7.86B |
| Gross Profit | 29.77B | 28.16B | 19.44B | 13.40B | 7.86B | 4.25B |
| EBITDA | 7.34B | 6.65B | 7.32B | 5.11B | 2.44B | 1.67B |
| Net Income | 3.77B | 3.50B | 2.97B | 2.85B | 496.82M | 571.05M |
Balance Sheet | ||||||
| Total Assets | 35.44B | 30.32B | 23.10B | 18.29B | 10.48B | 12.31B |
| Cash, Cash Equivalents and Short-Term Investments | 10.17B | 8.21B | 5.74B | 3.49B | 3.53B | 6.48B |
| Total Debt | 9.79B | 7.26B | 6.01B | 4.97B | 1.91B | 4.10B |
| Total Liabilities | 17.25B | 13.17B | 10.05B | 10.16B | 5.43B | 8.68B |
| Stockholders Equity | 18.19B | 17.15B | 13.05B | 8.14B | 5.05B | 5.15B |
Cash Flow | ||||||
| Free Cash Flow | 3.43B | 3.39B | 1.93B | 143.73M | -781.20M | -49.77M |
| Operating Cash Flow | 6.05B | 5.94B | 4.23B | 2.90B | 19.82M | 123.45M |
| Investing Cash Flow | -2.74B | -7.59B | -3.21B | -3.45B | -798.05M | 337.00K |
| Financing Cash Flow | 616.20M | -324.51M | 333.60M | 0.00 | -2.28B | 1.51B |
Luckin Coffee Technical Analysis
Neutral
35.80
Price Trends
33.56
Positive
32.93
Positive
33.86
Positive
Market Momentum
0.42
Positive
49.04
Neutral
40.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LKNCY, the sentiment is Neutral. The current price of 35.8 is above the 20-day moving average (MA) of 35.46, above the 50-day MA of 33.56, and above the 200-day MA of 33.86, indicating a neutral trend. The MACD of 0.42 indicates Positive momentum. The RSI at 49.04 is Neutral, neither overbought nor oversold. The STOCH value of 40.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LKNCY.
Luckin Coffee Risk Analysis
Luckin Coffee disclosed 108 risk factors in its most recent earnings report. Luckin Coffee 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
Luckin Coffee Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $9.98B | 2.47 | 22.13% | ― | 40.80% | -0.80% | |
65 Neutral | $8.14B | 64.69 | 13.05% | ― | 29.65% | 50.44% | |
65 Neutral | $7.10B | 106.15 | 8.28% | ― | 26.79% | -53.45% | |
62 Neutral | $119.10B | 60.04 | -24.31% | 2.37% | 4.51% | -24.97% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
52 Neutral | $743.63M | 40.82 | 2.85% | ― | 19.27% | 332.49% | |
49 Neutral | $814.24M | 62.18 | 3.21% | ― | -0.65% | ― |
* Consumer Cyclical Sector Average
LKNCY
Luckin Coffee
34.81
-1.96
-5.33%
SBUX
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104.47
22.39
27.29%
BROS
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46.58
-17.72
-27.56%
FWRG
First Watch Restaurant Group
12.05
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-34.01%
SG
Sweetgreen
6.84
-1.37
-16.69%
CAVA
CAVA Group, Inc.
60.76
-4.58
-7.01%
Luckin Coffee Corporate Events
Luckin Coffee Posts Double-Digit Revenue and Profit Growth on Aggressive Q2 2026 Expansion
Aug 3, 2026
Luckin Coffee reported unaudited financial results for the quarter ended June 30, 2026, showing net revenues of RMB15.9 billion, up 28.5% year-on-year, and GAAP operating income of RMB2.1 billion, up 22.0%. The company added 2,714 net new stores t...
Luckin Coffee Reshapes Board as Director Steps Down but Stays On as Advisor
May 20, 2026
On May 20, 2026, Luckin Coffee Inc. announced board changes following the expiration of two-year terms for several directors in May 2026, reaffirming its governance structure. Director Feng Liu chose not to seek reappointment for personal reasons ...
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.