FUTU - Futu Holdings stock price forecast: a good speculative buy
2023-08-28 12:29:33 ET
Futu Holdings (NASDAQ: FUTU) stock price made a strong bullish breakout on Monday as investors reacted to the company’s earnings. Chinese authorities also launched a new wave of measures to support the floundering the economy. The shares jumped by over 6% on Monday and reached a high of $55.25, the highest level since August 10th.
Futu growth is continuing
Futu Holdings is a Chinese company that operates a stock brokerage and wealth management industry. The firm is mostly owned by Tencent, the biggest gaming company in the world. It operates in key markets like Hong Kong, Singapore, and even in the United States.
The most recent Futu Holdings news was the company’s earnings, which came out on Thursday. The results showed that the firm added 57k customers in the quarter, bringing its total users to almost 1.6 million. Its total assets in the ecosystem soared to more than HK$466 billion. Total trading volume dropped y 22% to HK $1 trillion.
Futu Holdings revenue rose by 42% to HK$ 1.7 billion as brokerage commission dropped slightly to HK $953 million. Interest income rose by 127% as interest rates in key countries continued soaring. Total net income jumped by 74%.
Futu Holding faced numerous challenges in Q2 as the equity market in its key markets weakened. As I wrote here , the Hang Seng index has underperformed its global peers like the Nikkei 225 and Nasdaq 100 index.
There are also concerns that the Chinese and Singapore economies are slowing. The most recent data showed that China’s retail sales, exports , industrial production dropped. Similarly, Singapore retail sales dropped again in July. Despite this, Singapore’s business saw substantial inflows during the quarter.
Therefore, Futu Holdings stock rose after China announced a new set of measures to promote the economic growth. It also reacted to the talks between China and the United States.
Futu Holdings stock price forecast
The daily chart shows that the Futu stock price has risen in the past three days as investors cheer the company’s earnings. It has moved above the 25-day and 50-day moving averages.
Most importantly, it has formed what looks like an inverted head and shoulders pattern, which is usually a bullish sign. Therefore, I believe that Futu is a good speculative stock to buy at the current prices. The initial target for this outlook is $61.65, the highest point in August, which is 14% above the current level.
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