Meituan plans buyback at HKD 64.45 as CFO says stock undervalued

Meituan CFO Chen Shaohui said the company's value is severely undervalued and announced a planned share buyback, sending the stock to HKD 64.45.

"The company's share price performance over the past few years has been unsatisfactory and I feel a strong sense of responsibility for this," Wang Xing, chief executive officer of Meituan, said at the annual general meeting, according to China Business Network.

The stock traded at HKD 64.45, down 2.5%, with 57.18 million shares changing hands worth HKD 3.78 billion. Short-selling activity accounted for 25.2% of trading volume as of June 26.

The buyback signals management's conviction in Meituan's intrinsic value at current levels. Wang said the company will also consider exiting certain external investments under appropriate circumstances, as those holdings could generate favorable returns after listing.

Chen called on the entire industry to pursue more rational development, reflecting broader concerns about competitive dynamics in China's food delivery and local services market. The company did not disclose the size or timeline of the buyback plan.

The planned share repurchase comes as Meituan faces intensifying competition from ByteDance-owned Douyin in the local services space and a sluggish consumer spending environment in China. The stock has declined more than 85% from its 2021 peak of over HKD 460 per share.

The buyback plan provides a potential floor for Meituan's stock and signals management's confidence in the company's long-term prospects. Investors will watch for details on the buyback size and execution timeline, as well as progress on exiting external investments that could unlock additional value.

This article is for informational purposes only and does not constitute investment advice.