UPDATE: JPMorgan Upgrades GSX Techedu Inc. (GSX) to Neutral
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JPMorgan analyst DS Kim upgraded GSX Techedu Inc. (NYSE: GSX) from Underweight to Neutral with a price target of $37.00 (from $60.00).
The analyst comments "We close our UW call on GSX post unprecedented 51% drop in the past seven trading days (vs. SPX’s +4%) or -64% in the past month (vs. SPX’s +6%). Granted, there still exist myriads of uncertainty from both topdown (policy reform for tutoring sector) and company-specific (surprisingly slow growth in 1Q, upcoming 20-F) perspectives, making it difficult to turn outright bullish. That said, well-publicized technical selling pressure should subside sooner or later (if not have already), which alone could push the stock higher near-term to narrow the gap with peers (that have corrected only 5-10% in the past 7 trading days) to some extent. We thus want to lock-in profits from our UW and neutralise our rating."
Shares of GSX Techedu Inc. closed at $33.40 yesterday.
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