Meituan-W (03690) saw a significant rise of over 6% in early trading.

As of the latest update, the stock was up 6.33%, trading at HK$78.10 with a turnover of HK$2.402 billion.

The company is scheduled to hold a board meeting on June 1 to consider and approve the unaudited financial results for the first quarter of 2026.

In a recent research report, Morgan Stanley reiterated its Overweight rating on Meituan, maintaining a price target of HK$120.

The bank also upheld its profit forecasts for the company.

It continues to assume that the unit economic benefit per order for the food delivery business will reach RMB 1 starting from 2027.

Under the base case scenario, the operating profit margin for the in-store, hotel, and travel business is expected to gradually recover from the current 25% to an estimated 30% by 2030.

Morgan Stanley noted that following Alibaba's commitment to significantly narrow losses in its instant retail business, the clarity of Meituan's roadmap towards profitability has improved markedly.

Regarding business segments, Morgan Stanley forecasts that Meituan's first-quarter total transaction value and revenue for the in-store, hotel, and travel segment will increase by 10% and 9% year-on-year, respectively.

Operating profit is expected to remain largely flat quarter-on-quarter at RMB 4.1 billion, with an operating profit margin of 25%.

For new businesses, its overseas operation KeeTa will focus on consolidating its existing markets this year.

Unit economics in Saudi Arabia continue to improve, while the Hong Kong market remains profitable.