Research on Meituan' valuation based on qualitative and quantitative analysis

Abstract

Company valuation is a crucial part to help stakeholders to make accurate financial decisions. Valuation multiples is a financial measurement tool that recognized one financial ratio of another, therefore it allows to compute financial ratios of a certain entity to be more comparable with other business. The research object in this essay is Meituan, which is a Chinese company operating as a delivery platform. This paper uses the qualitative approach with a SWOT analysis for its macro environment, and the multiple valuation method to evaluate and predict its trend of stock price. The result illustrates that Meituan is currently performing well in financial position, and is predicted to grow rapidly in the future. In that case, the stock of Meituan is still profitable and worthwhile to be invested. However, investors should not be ignored that the uncertainty of covid epidemic, which plays an important role in Meituan’s development in the future. Meanwhile, the single profit model and lack of unique raise the uncertainty of long-run growth.