The analyst thinks the company, which listed in December 2020, deserves a “no-moat rating” based on the “shorter lifespan” of Pop Mart's top intellectual properties (IPs), limited successes outside of toys and weaker pricing power versus global IP operators.
Shares of Hong Kong-listed toy and merchandise manufacturer Pop Mart International have ballooned by nearly 500% in value over the past year. Now, Morningstar Equity Research analyst Jeff Zhang is warning that the Labubu creator’s stock is “overpriced”, even with 107% y-o-y revenue growth in 2024.
Zhang initiated coverage on Pop Mart in a May 29 note, assigning it a two-star rating against Morningstar’s five-tier scale. Zhang’s fair value estimate of HK$164 is also 25% below its current traded price.
