DAO - So-Young: Highly Attractive Risk-Reward Profile

• So-Young is a small-cap internet company in China. The company operates the country’s leading online platform to connect buyers and sellers of medical aesthetic solutions.
• So-Young has 4.4 million monthly active users, which the company claims to be highly loyal and engaged.
• Speculators might find significant value based on three pillars: (1) the company can either find growth, (2) sustain/slightly increase profitability (3), or distribute net cash to shareholders.
• I calculate a fair base-case target price of $4.92/share and assign a Strong BUY recommendation on >400% upside potential.
• However, given the speculative nature of the trade, I also assign a High-Risk label.

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