SINGAPORE - UP Fintech Holding Limited (NASDAQ:TIGR), known for its online brokerage services for global investors, has announced its intention to offer and sell 15 million American Depositary Shares (ADSs), with each ADS representing 15 Class A ordinary shares of the company. This move is subject to market and other conditions, including an underwritten public offering. Additionally, underwriters will have the option to purchase up to an extra 2.25 million ADSs within 20 days following the prospectus supplement date.
The company aims to utilize the net proceeds from this offering to strengthen its capital base and to support business development initiatives. Deutsche Bank AG (NYSE:DB), Hong Kong Branch, China International Capital Corporation Hong Kong Securities Limited, and US Tiger Securities, Inc. have been appointed as joint bookrunners for the proposed ADS offering.
The offering will be conducted in accordance with an automatic shelf registration statement previously filed with the United States Securities and Exchange Commission (SEC). Relevant documents, including a preliminary prospectus supplement and an accompanying prospectus, are available on the SEC's website. The final prospectus supplement will also be filed and made available on the SEC's website in due course.
UP Fintech, also known as Tiger Brokers, provides a proprietary mobile and online trading platform that allows investors to trade equities and other financial instruments across various international exchanges. The company is recognized for its mobile-first strategy, which has been instrumental in enhancing user experiences and expanding its customer base. UP Fintech offers a range of brokerage and value-added services, such as trade order placement and execution, margin financing, IPO subscriptions, ESOP management, investor education, and customer support.
This press statement includes forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements reflect the company's current expectations regarding future events, including its strategic and operational plans and financing intentions. However, these forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those projected.
The information contained in this article is based on a press release statement from UP Fintech Holding Limited.
In other recent news, UP Fintech Holding Ltd. faced a significant reduction in its second-quarter non-GAAP net profit, dropping 65% from the previous quarter and 66% from the same period last year. This decline was primarily due to a one-time provision of $13.2 million for a legacy stock pledge business in Hong Kong. However, excluding this provision, UP Fintech's operating profit showed strong growth, increasing by 30.9% from the previous quarter and 68.2% from the same period last year, fueled by solid trading volume and the expansion of its Mutual Fund Service License.
The firm also reported a considerable increase in new paying customers, adding 48.9 thousand in the second quarter alone. This growth represents a 69.8% rise quarter-over-quarter and a 68.6% increase year-over-year. These additions in the first half of 2024 make up 52% of the management's full-year guidance of 150 thousand new paying customers.
UP Fintech's second quarter of 2024 also saw record-breaking revenue, reaching an all-time high of $87.4 million. This was alongside a 121% increase in client assets compared to the previous year, totaling $38.2 billion. Despite the challenges posed by the loss provision related to the Hong Kong stock pledge, the firm anticipates further strength in trading volumes and revenue momentum in the third quarter.
Citi has revised its price target for UP Fintech shares to $5.00 from the previous $6.49, based on these recent developments. This adjustment was made using a discounted cash flow model, taking into account the latest earnings revision. Despite the reduced target, Citi maintains a Buy rating on the stock, albeit with a High Risk rating.
InvestingPro Insights
UP Fintech Holding Limited's (NASDAQ:TIGR) decision to offer 15 million American Depositary Shares comes at a time when the company is experiencing significant market momentum. According to InvestingPro data, TIGR has shown impressive price performance, with a 101.63% return over the last month and a 131.78% return over the past six months. This strong market performance aligns with the company's move to capitalize on investor interest and raise capital for business development.
The company's financial health appears robust, with revenue growth of 12.96% over the last twelve months and a notable 32.76% quarterly revenue growth as of Q2 2024. TIGR's gross profit margin stands at a healthy 82.74%, indicating efficient cost management in its core operations.
InvestingPro Tips highlight that TIGR is trading at a high earnings multiple, with a P/E ratio of 43.73. This valuation suggests that investors have high growth expectations for the company, which may be supported by analysts' predictions that the company will be profitable this year. The stock's high price volatility, as noted in another InvestingPro Tip, could be attractive for investors looking for potential high returns, as evidenced by the strong performance over various timeframes.
It's worth noting that TIGR does not pay a dividend to shareholders, focusing instead on growth and reinvestment. This strategy appears to be paying off, given the company's profitability over the last twelve months and its plans for further business development.
For investors seeking a deeper understanding of UP Fintech's potential, InvestingPro offers additional tips and insights. In fact, there are 8 more InvestingPro Tips available for TIGR, which could provide valuable context for the company's current offering and future prospects.
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