Morgan Stanley: Bubble Mart stock price is expected to remain volatile after the financial report is released.

Morgan Stanley stated that due to highly divergent market views, it is expected that the stock price of Pop Mart will remain volatile after the release of its financial report on March 25th. The stock price may rise first and then enter a new round of range oscillation. Analysts Dustin Wei, Jenny Yu, and others in the report stated that the stock price has fluctuated significantly in the past two and a half months, but no substantial changes in profit expectations have been observed between the bulls and bears. The bullish side expects profits to reach 16.5 to 17 billion RMB by 2026, while the bearish side expects a weak profit growth and a decline starting from the second half of 2026. Investors are focusing on the upcoming earnings guidance, but the bank believes that the impact of management's outlook may be limited, as the bulls and bears may have different interpretations of the same information. Mainland southbound funds remain the main source of bullish positions, while foreign hedge funds are the main source of bearish positions. It is expected that Pop Mart had strong sales momentum in China in the fourth quarter of last year and the first quarter of this year. After a significant increase in supply, Labubu's sales performance in the fourth quarter of last year remained robust, similar to the third quarter level.