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Buffett's senior apprenticeMeituan has fallen below its 52-week low. Is it time to consider opening a position?
After hovering around the HKD 100 mark for a long time, Meituan's rebound ultimately proved weak. On February 5th, it decisively fell below its 52-week low, touching HKD 90.2.
Looking back at the high of HKD 189.6 on March 7th, 2025, the stock price has now been halved.
The brutality of the battle between giants is laid bare on the K-chart. With Alibaba's heavy troops pressing from the front and Douyin eyeing covetously from behind, Meituan is caught in a pincer attack. The stock's downtrend doesn't lie.
In comparison, Alibaba's situation appears much more comfortable, with a 52-week low of HKD 94, a 52-week high of HKD 186, and a current price of HKD 158.
Although Alibaba's takeoff benefited more from the new AI narrative, the capital market clearly also recognizes Alibaba's battle achievements over the past year.
Looking back at my concerns about Meituan, they mainly focused on two points:
1. One is that the business model isn't good enough, making it very difficult to earn money.
2. I felt that Meituan, as a dominant player, faces immense pressure on all fronts, making it hard to sleep soundly.
Now, times have changed. Re-examining these two concerns today:
1. That the business model isn't good enough has actually been proven. Meituan's business model indeed cannot compare with Pinduoduo's, and due to Alibaba's large-scale offensive, the entire food delivery business model faces even greater challenges. These are objective facts, but business rationality will ultimately return.
2. Interestingly, precisely because the food delivery market competition is white-hot, the second concern has been resolved instead. If the sky falls, Alibaba is there to hold it up. Isn't this a case of "a blessing in disguise"?
Therefore, considering Meituan's current stock price and factors like the Stock Connect, I've recently started re-evaluating whether to establish a position in Meituan.
Especially in the current era of AI's rapid advancement, which brings both excitement and deep unease, compared to the uncertainty of the AI "bit (Byte)" logic, Meituan's ability to fulfill orders by moving nearby "atoms" instead provides a certain degree of certainty.
Perhaps I should wait a bit longer, or perhaps just start with a small observation position. Welcome to leave comments and discuss.
$MEITUAN(03690.HK) $BABA-W(09988.HK)
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