Bernstein SocGen Group increased its price target for Kanzhun Ltd. to $19 from $18 on Wednesday, maintaining an Outperform rating as the company's AI monetization strategy gains traction.
The move follows strong second-quarter results, with Kanzhun reporting a 14% year-over-year revenue increase to RMB 2.4 billion. Non-GAAP operating profit rose 19.2%, while adjusted operating profit climbed 19%, reaching a record margin of 43.8%. Gross margin remained exceptionally high at 86%, with a trailing P/E ratio of 13.3.
Net income, excluding investment gains, grew 9% year-over-year, while average revenue per paying user increased 7% in the second quarter. The company also announced a $230 million dividend for the year and executed $300 million in share buybacks, returning a total of $530 million to shareholders—equivalent to 7.3% of its market capitalization.
Kanzhun reaffirmed its commitment to distributing over 50% of the prior year's net income in capital returns. Third-quarter revenue growth is projected between 11.4% and 15.6% year-over-year, aligning with market expectations. Management also forecast billings growth in the low double digits for the second half of the year, with efforts to boost average revenue per paying user cited as a key driver.
BofA Securities maintained a Neutral rating with a $19 price target, while Morgan Stanley reiterated an above-average rating with a $24 target.
