Morgan Stanley downgraded its rating on Qifu Technology to Equal-weight from Overweight and reduced its price target to $13 from $25, citing persistent headwinds in the consumer finance sector.
The brokerage highlighted ongoing liquidity constraints and difficulties in bad debt recovery as key pressures on the company’s core operations. Qifu’s shares were trading at $9.30 on Friday, down 59% over the past year and near the 52-week low of $10.85.
Qifu reported second-quarter 2026 adjusted earnings per share of $6.56, exceeding analyst expectations of $4.90, but revenue came in at $3.57 billion, below the $4.02 billion forecast. The company also issued weak profit guidance for the third quarter of 2026, with the midpoint falling short of consensus estimates.
Separately, Jefferies maintained its Buy rating on Qifu but lowered its price target to $15.40 from $20.40, attributing the cut to softer-than-expected loan volumes and non-GAAP earnings performance. Morgan Stanley’s downgrade reflects broader concerns about tighter funding conditions and rising credit risk within the sector.
