LexinFintech (LX, Financial) saw a significant increase in its stock price, surging 26.84% to close at $3.45. This surge, driven by factors such as a continuous rally in Chinese stocks, valuation recovery, and upcoming Q3 earnings report, saw a trading volume of $48.41 million, nearly double the previous day's $25.85 million.
The stock opened higher and continued to rise, reaching an intra-day high of $2.94, and closed at $2.72, marking the highest price since February 9, 2023. Post-market data also indicated a further 0.77% increase. This marked the sixth consecutive day of gains for LexinFintech, with its stock price rising by 106.6% during this period. The $48.41 million trading volume was the highest in 39 months, last seen on June 24, 2021, at $66.02 million.
Despite broader market declines influenced by Middle East tensions and oil price volatility, with the Dow Jones, Nasdaq, and S&P 500 indices all closing lower, Chinese stocks continued their upward trend. The Nasdaq Golden Dragon China Index closed up 5.48%, with notable increases from Bilibili, Li Auto, Pinduoduo, JD.com, XPeng, and NIO.
LexinFintech's recent stock performance is attributed to optimism around its H2 performance, valuation recovery, and the upcoming Q3 earnings. In Q2 2024, the company reported revenues of RMB 3.64 billion, up 12.3% quarter-over-quarter, and a net profit of RMB 227 million, up 12.4% quarter-over-quarter. The company is set to release its Q3 earnings in November, with the market holding positive expectations.
LexinFintech's CEO outlined the company's strategic focus for the latter half of the year, emphasizing prudent management, risk containment, scale growth, enhanced profitability, user engagement, and accelerated international expansion. Lexin has maintained a semi-annual dividend policy, offering a dividend yield exceeding 8.1%.
The company's international business is making significant strides, particularly in Mexico, where Q2 loan volumes grew 61% quarter-over-quarter, and revenue increased by 113%. Despite an earlier 80% stock price decline impacted by market conditions, Lexin's current rally signals a value rebound, with its PE and PB ratios still at low levels compared to peers, indicating potential growth.
LexinFintech was founded in August 2013 in Shenzhen, China, and has since been connecting young Chinese consumers with new consumption brands through its platform. The company went public on the NASDAQ in December 2017.
