Chagee Holdings Limited (NASDAQ: CHA) received an upgrade from JPMorgan, shifting its rating from Underweight to Neutral on February 13, 2026. However, the investment bank reduced its price target for the company from $12.40 to $11.50. Analyst Jessie Xu indicated that the company is “approaching a pivot point” following a challenging period marked by five consecutive quarters of declining same-store sales.
The share price of Chagee Holdings has plummeted more than 60% from its initial public offering (IPO) price of $28. Despite this significant drop, Xu believes the current price reflects improved risk/reward dynamics, especially in light of new initiatives aimed at supporting a potential turnaround in the latter part of 2026.
Market Context and Competitor Insights
Earlier this year, Jefferies initiated coverage of Chagee Holdings, assigning a Hold rating with a price target of $14. This evaluation is part of a broader analysis of leading Chinese freshly-made drink brands. In its assessment, Jefferies expressed a preference for competitors such as Guming and Mixue (MXUGF), citing stronger growth visibility within this sector compared to Chagee.
Chagee Holdings operates a network of teahouses under the CHAGEE brand, both within China and internationally, and is involved in the sale of tea drinks, raw materials, packaging, equipment, and related supplies. The company’s performance has been under scrutiny, given the recent trends in consumer behavior and market competition.
While some analysts recognize the potential of Chagee Holdings as an investment opportunity, others suggest that stocks within the artificial intelligence sector may present greater prospects for higher returns with limited downside risk. Investors seeking alternatives may find promising AI stocks with substantial upside potential, as discussed in various market reports.
As Chagee Holdings navigates this pivotal period, stakeholders will be keenly observing its strategies and market responses in the face of evolving dynamics in the beverage industry. The ability of the company to execute new initiatives effectively will be crucial in determining its future trajectory.
