JP Morgan: First initiated J&T EXPRESS-W (01519) with a "buy" rating. Stock price overly pessimistic, growth and profit turning point on the horizon.

JPMorgan Chase released a research report stating that it first gave J&T EXPRESS-W (01519) a "buy" rating with a target price of HK$13. J&T Express's business has turned profitable, achieving industry-leading profit and business volume growth, and releasing new synergies through cooperation with SF Express (06936). Although there is a clear turning point in profitability and a proven and replicable export business model, the stock's valuation has fallen to around 10 times forecasted non-IFRS price-earnings ratio. The bank believes that J&T's scalable platform, accelerated growth in new markets, and cost leadership position are not reflected in the current valuation. Considering its expected compound annual growth rate of around 50% in adjusted net profit for the fiscal years 2025 to 2028 (compared to the industry average of 15% to 20%), the bank believes a premium of around 20% above the industry average is reasonable.