Morgan Stanley lowers Meituan's target price to 95 yuan due to intensified competition and decreased profitability visibility

JP Morgan released a report based on Meituan-W (03690.HK) Q3 2025 performance, taking a cautious stance and believing that investors should temporarily wait and closely monitor developments in three key areas: competition in the takeaway business, sustainability of in-store business profits, and execution of overseas expansion. These businesses face significant uncertainties—from the intensity and duration of subsidy competition in the takeaway business, to the speed at which in-store business profit margins stabilize, to the capital intensity and return cycles of overseas investments—these factors collectively weaken financial visibility and increase the risk of profit volatility.

JP Morgan lowered its Q4 2025 earnings forecast for Meituan by 31% to reflect the decline in in-store business profitability, and believes that there is limited room for reassessment until clearer evidence emerges proving that profit margin trends are more predictable, core takeaway business competitive behavior becomes more rational, and the framework for international expansion becomes more disciplined. It maintains a "Neutral" rating. The target price is lowered from 100 yuan to 95 yuan