TIGR, a leading online broker with a global presence, is set to benefit from strong wealth market growth in Hong Kong and Singapore, where investors are increasingly seeking smarter, more cost-effective platforms. With its full suite of products and competitive pricing, UBS think TIGR looks well positioned to win share from traditional institutions. Its tech-first brokerage model may enable high operating leverage, translating into rapid bottom-line growth and margin improvement as client AUM scales. UBS find the story compelling: fast client acquisition, expanding wallet share and improving margins, along with untapped upside potential from digital assets.

Margin expansion powered by AUM growth

UBS expect TIGR’s net margin to rise from ~16% in 2024 to ~29% by 2027, driven by a ~24% client AUM CAGR. Net client asset inflow of US$10.4/6.3/7.1bn in 2025E/2026E/2027E could be supported by strong traction in Hong Kong and Singapore. We expect Hong Kong’s share of funded accounts/client AUM to double/triple by 2027. Singapore remains TIGR's anchor market, contributing around half of its clients and ~40% of client AUM. TIGR’s product depth and pricing edge cater well to overseas investment demand, especially in US equities and derivatives. We think its focus on high-quality clients further supports a margin uplift.

Digital assets: Optionality, not dependency

TIGR’s digital asset capability may present medium- to long-term upside potential. The digital asset adoption trajectory remains closely tied to regulatory developments, which have been cautious recently. If the regulatory environment in Hong Kong becomes more supportive, we think there could be a modest revenue uplift of 6-7% by 2027. We view digital assets as a complementary lever in the broker's broader platform, rather than a primary long-term growth driver.

Valuation: Price target of US$13.10 implies 16x 12-month-forward PE

Our US$13.10 price target (16x 12-month-forward PE) is based on a three-stage residual income model. We forecast 2024-27 CAGRs of: 1) 13% in the number of funded accounts; 2) 10% in average client AUM; and 3) 17%/45% in revenue/net income, ahead of Visible Alpha consensus (12%; 5%; 15%/34%). Key risks include: 1) further regulatory scrutiny into Mainland China business; 2) slower-than-expected development in Hong Kong; and 3) worse-than-expected market conditions.

Pivotal Questions

Q: Can TIGR steadily improve its net margin to 25-30% by 2027?

Highly likely. We forecast its net margin to rise from ~16% in 2024 to ~29% by 2027, driven by a ~24% client AUM CAGR. We expect the broker’s tech-led model to scale efficiently to boost operating leverage and underpin margin improvement. We estimate net client asset inflow of US $10.4/6.3/7.1bn in 2025/2026/2027, fuelled by strong client growth and a rising wallet share, especially in Hong Kong and Singapore. TIGR’s comprehensive product suite meets overseas investment demand, as its competitive pricing wins clients and a superior app experience keeps them. As such, we expect TIGR to consistently win share from traditional brokers and banks. We estimate Hong Kong’s share of funded accounts/client AUM to double/triple to ~11%/19% by 2027 (Q225: ~5%/6%), while Singapore remains its core market (~50% of paying clients, ~40% of retail AUM). The broker’s focus on high-quality clients may further support margin gains.

Q: Will the digital asset business become a meaningful revenue contributor?

More likely in the medium to long term (ie, post-2027). Drawing on developments in the US, digital assets may offer incremental avenues for growth and margin opportunities stemming from: 1) higher trading velocity and commission rates in digital spot markets relative to traditional cash equities; 2) broader monetization potential across the ecosystem; and 3) possible client asset inflow acceleration. TIGR has built comprehensive digital asset infrastructure and is gaining traction among investors. That said, the pace of adoption in Hong Kong remains closely linked to regulatory developments, which currently appear cautious. If the regulatory environment turns more constructive, we think there could be a modest revenue uplift of 6-7% by 2027.

UBS VIEW

We initiate coverage with a Buy rating. Backed by a competitive product suite and a tech-driven model, TIGR is well positioned to capture market share in the two fast-growing wealth hubs of Hong Kong and Singapore. The growth story is clear: rapid client acquisition, deepening wallet share and improving profitability. Digital asset-related activity is an emerging area with long-term potential, rather than immediate upside.

EVIDENCE

Based on a UBS Global Wealth Report, in 2024 Hong Kong/Singapore account for 0.8%/0.5% of global personal wealth, 10th/11th globally. Average/median wealth per adult has reached US $601k/222k in Hong Kong and US$442k/114k in Singapore. In Q225, TIGR’s newly acquired clients in those markets each brought in ~US$30k, on average (overall average: US$20k), driving 50% and 20% QoQ growth in client AUM in Hong Kong and Singapore. In terms of digital assets, spot trading shows annualized velocity (>7x) far above that in most traditional stock markets (UBSe: 0.3-2.2x).

WHAT´S PRICED IN?

We believe TIGR’s margin upside and client AUM growth are underestimated. We forecast net margin to reach ~29% by 2027, driven by a ~24% CAGR in client AUM, ahead of Visible Alpha consensus (~25% margin, ~17% CAGR). TIGR is trading at ~12x 12-month-forward PE, likely implying a mid-teens CAGR in client AUM in 2024-27. Our price target of US$13.10 implies 16x 12- month-forward PE.

Company Description

TIGR is a leading online brokerage, offering a proprietary mobile and web platform for global trading across equities and financial instruments. Powered by advanced technology, TIGR enables seamless trading across multiple currencies, markets, products, execution venues and clearinghouses.