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Luckin Coffee’s Growth Prospects Generate a Buzz Amongst Analysts

Customers sit at tables in a Luckin Coffee outlet in Beijing.
Customers sit at tables in a Luckin Coffee outlet in Beijing.Photographer: Gilles Sabrie/Bloomberg

Luckin Coffee Inc., China’s second-biggest coffee chain, received two new bullish reviews from Keybanc and Needham, while Morgan Stanley added a note of caution.

Analysts who have weighed in so far like Luckin’s strategic store positioning, competitive coffee pricing compared to rival Starbucks Corp and expansion potential in the Chinese market. Morgan Stanley analyst Lillian Lou was more cautious, seeing limited gains in the near future on “relatively low earnings visibility,” and noting that valuation already “looks fair.”