UBS cuts KUAISHOU-W target price to 68 yuan, lowering 2026 earnings per share estimate by 32% to 34%

UBS published a research report indicating that KUAISHOU-W (01024.HK) performed roughly in line with expectations in the fourth quarter of last year. The bank has lowered its short-term forecasts considering macroeconomic uncertainties, rising investments in artificial intelligence, and regulatory headwinds. However, it believes that the negative factors for the company have largely been reflected.

The bank stated that as Kecai AI becomes a global competitor in the short video generation field, and KUAISHOU-W is one of the lowest-valued companies in the global AI industry, it maintains a "Buy" rating. However, the bank has reduced its revenue forecast for the company this year by 5%, lowered its gross margin forecast by 346 basis points to 52.7%, and increased its R&D expenditure forecast. Therefore, it has cut its earnings per share estimates for 2026 to 2028 by 32% to 34%, with the target price significantly reduced from HKD 108 to HKD 68