UP Fintech downgraded to Sell from Buy at Citi

Citi analyst Judy Zhang downgraded UP Fintech (TIGR) to Sell from Buy with a price target of $5.50, up from $5, after the company announced a “surprising” equity raise of 15M shares. This is the first round of equity raising since June 2021 and the transaction could boost UP Fintech’s equity base by 22% to 25%, resulting in 10% dilution for fiscal 2025 earnings, the analyst tells investors in a research note. The firm says that while earnings dilution might hit short-term market sentiment, it sees it as a positive for UP Fintech’s long-term business outlook. Nonetheless, Citi double downgraded the shares on valuation following the recent share rally. The “excessive” share price rally post the historic China policy combo “seems overdone” given UP Fintech earnings is not as sensitive to the Hong Kong market, the firm says.