Kanzhun Ltd ADR

BZ: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$39.00	Xxvm	Dfnhhtpd

Boss Zhipin Earnings: Lowering Fair Value by 40%; Scalability, Macro, and Profitability Concerns

Kai Wang

Aug 29, 2024

We lower our fair value estimate for Boss Zhipin to $12 per ADR (HKD 46.90 per share) from $20 (HKD 78.20) despite the company reporting second-quarter 2024 revenue of CNY 1.9 billion, which represented a 29% increase year on year. We thought the company performed well during the second quarter with robust revenue growth and operating margin expansion of 640 basis points year on year, along with a 31% increase year on year in paying customers. However, the company had a negative outlook that suggested a lack of visibility due to macroeconomic soft demand for recruitment services and structural problems with long-term domestic scalability.

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