Kanzhun (NasdaqGS:BZ): Is Strong Analyst Optimism Justified in Its Current Valuation?

If you have been watching Kanzhun (NasdaqGS:BZ), you may have noticed some excitement building around the stock. A recent shift in analyst sentiment, with its Zacks Rank upgraded and consensus earnings estimates ticking up over the past few months, has pushed Kanzhun into the investor spotlight. This move suggests that the market is reassessing the company's growth trajectory, raising the stakes for what comes next.

Momentum is clearly on Kanzhun’s side this year. The stock has outperformed the broader Computer and Technology sector, delivering a year-to-date return of nearly 80% and an impressive 102% over the past twelve months. Over the past quarter alone, shares have climbed nearly 40%, showing that enthusiasm has not really fizzled out. With annual revenue and net income both posting double-digit growth, it is clear why optimism is picking up, though the sharp rally brings up some questions about sustainability.

So after this performance surge, is Kanzhun a can’t-miss opportunity, or could the market already be pricing in all that future growth?

Most Popular Narrative: Fairly Valued

According to the most widely followed narrative, Kanzhun is considered fairly valued, with the current share price almost exactly matching the consensus price target set by analysts. This reflects a view that the market is closely aligned with the latest growth projections and risk assessments for the company.

Operating leverage through cost control, efficiency gains from AI integration across R&D and customer service, and a robust two-sided network effect are together driving margin expansion. This suggests continued improvement in net margins and profitability.

Discover the formula behind Kanzhun’s fair value. Analysts have focused on specific growth assumptions, along with a unique combination of platform upgrades, profitability gains, and market expansion goals. Want to know the essential numbers and projections that set this fair price? The model draws from industry trends and bold company forecasts. Find out exactly what powers this consensus and why analysts are neither bullish nor bearish at today’s levels.

Result: Fair Value of $24.40 (ABOUT RIGHT)

Have a read of the narrative in full and understand what's behind the forecasts.

However, a shrinking graduate talent pool and increasing industry competition could make it difficult for Kanzhun to maintain its current growth pace.

Find out about the key risks to this Kanzhun narrative.

Another View: What Does Our DCF Model Say?

While analyst targets suggest Kanzhun is fairly valued, our SWS DCF model comes to a different conclusion. It indicates the stock may actually be trading at a discount. Could this method be surfacing hidden value that others miss?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Kanzhun for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Kanzhun Narrative

If you see the numbers differently or want to test your own assumptions, you can craft a personal narrative in just a few minutes. Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Kanzhun.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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