Futu (NASDAQ:FUTU) Releases Quarterly Earnings Results, Misses Estimates By $2.12 EPS

Futu (NASDAQ:FUTU) issued its quarterly earnings results on Thursday. The company reported $0.77 earnings per share (EPS) for the quarter, missing the consensus estimate of $2.89 by ($2.12), FiscalAI reports. Futu had a net margin of 49.63% and a return on equity of 32.24%. The business had revenue of $694.17 million during the quarter, compared to the consensus estimate of $761.35 million.

Here are the key takeaways from Futu’s conference call:

• Futu added 225,000 net new funded accounts in Q1, bringing total funded accounts to 3.59 million, up 34% year over year. Management said Hong Kong, Malaysia, and Singapore remained important growth drivers, while overseas Moomoo accounts surpassed 2 million.
• Trading activity hit a record, with total volume reaching HKD 4.15 trillion, up 29% year over year. U.S. volume stayed strong at HKD 3 trillion, while Hong Kong volume rose 22% sequentially as investors bought into volatility.
• Revenue rose 25% year over year to HKD 5.9 billion, but net income fell sharply because the company booked an approximately RMB 1.85 billion administrative penalty reprieve as an adjusted subsequent event. Excluding that item, management said net income would have increased year over year.
• Management highlighted continued expansion into new products and markets, including U.S. prediction markets, where it expects to launch event-contract trading soon, and the PantherTrade crypto exchange in Hong Kong, which has begun full operations after VATP approval.
• Futu said wealth management assets reached HKD 178.4 billion, up 28% year over year, with more client allocation shifting toward equity funds and structured products. It also said it remains confident in long-term growth in mature markets like Hong Kong and Singapore, and reiterated that the recent regulatory update should not materially affect full-year guidance.

Futu Price Performance

Futu stock opened at $110.22 on Thursday. The business has a 50 day moving average of $142.96 and a 200-day moving average of $156.30. Futu has a 1 year low of $80.50 and a 1 year high of $202.53. The company has a market capitalization of $15.45 billion, a P/E ratio of 10.72, a P/E/G ratio of 0.75 and a beta of 0.52.

Futu Announces Dividend

The company also recently disclosed a special dividend, which was paid on Wednesday, April 29th. Stockholders of record on Thursday, April 16th were paid a $2.60 dividend. The ex-dividend date of this dividend was Thursday, April 16th. Futu’s dividend payout ratio is currently 24.81%.

Institutional Trading of Futu

Several institutional investors have recently modified their holdings of the business. Virtu Financial LLC bought a new stake in shares of Futu in the fourth quarter worth $340,000. Invesco Ltd. grew its stake in shares of Futu by 15.0% in the fourth quarter. Invesco Ltd. now owns 47,019 shares of the company’s stock worth $7,721,000 after purchasing an additional 6,138 shares during the last quarter. Achmea Investment Management B.V. bought a new stake in shares of Futu in the fourth quarter worth $486,000. Vident Advisory LLC grew its stake in shares of Futu by 38.0% in the fourth quarter. Vident Advisory LLC now owns 23,251 shares of the company’s stock worth $3,818,000 after purchasing an additional 6,407 shares during the last quarter. Finally, Wellington Management Group LLP grew its stake in shares of Futu by 118.0% in the fourth quarter. Wellington Management Group LLP now owns 49,024 shares of the company’s stock worth $8,050,000 after purchasing an additional 26,536 shares during the last quarter.

Wall Street Analyst Weigh In

A number of research firms have recently weighed in on FUTU. The Goldman Sachs Group downgraded shares of Futu from a “buy” rating to a “neutral” rating and set a $102.13 price target on the stock. in a research note on Monday. Barclays reduced their price target on shares of Futu from $236.00 to $200.00 and set an “overweight” rating on the stock in a research note on Monday, March 16th. JPMorgan Chase & Co. restated a “neutral” rating and issued a $87.00 price target (down from $300.00) on shares of Futu in a research note on Friday, May 22nd. Finally, Zacks Research cut Futu from a “strong-buy” rating to a “hold” rating in a research note on Friday, May 8th. One investment analyst has rated the stock with a Strong Buy rating, three have given a Buy rating and five have assigned a Hold rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $161.52.

About Futu

Futu Holdings Ltd. is a technology-driven brokerage and wealth management company that provides online brokerage services, market data, and investment tools to retail and institutional clients. Headquartered in Hong Kong and listed on the NASDAQ under the ticker FUTU, the company operates digital trading platforms that combine order execution, real-time quotes, news, and research tools to serve active investors and wealth management customers.

The firm’s product suite includes brokerage access to equities, exchange-traded funds and derivatives across major markets, margin financing, initial public offering (IPO) subscription services, wealth management products and discretionary investment solutions.