Lufax Holding Ltd (LU) Sells $64M in Bad Loans to Cut Credit Risk, Stabilize Outlook
Lufax Holding Ltd (NYSE:LU), a leading Chinese fintech firm serving small and micro businesses, is undergoing strategic shifts to navigate a challenging market in 2025. A key recent development was the sale of non-performing loans (NPLs) through its subsidiary, Ping An Consumer Finance. The transaction involved offloading 469 million yuan in NPLs for 36.44 million yuan to Sh China Merch Ping An Asset Management. This move reduced credit risk and supported a drop in the company's loan portfolio by 18%, helping stabilize investor sentiment amid asset quality concerns.
In addition to asset optimization, Lufax Holding Ltd (NYSE:LU) is focusing on digital transformation through new partnerships and AI-driven innovation. These efforts aim to boost operational efficiency and profitability while enhancing its competitive edge in a crowded fintech market. The business is also pursuing cost-cutting measures as part of a broader strategy to improve earnings.
Despite these positive steps, cheap stocks to buy like Lufax Holding Ltd (NYSE:LU) saw sharp declines in late July, dropping over 11% and 12% on back-to-back days. The sell-off reflected investor concerns over limited near-term catalysts and persistent pressure from traditional banks.
An individual using a laptop to access the fintech platform to manage their finances.
Looking ahead, the corporation plans to continue managing credit risk proactively, expand its digital offerings, and pursue strategic partnerships. These efforts are expected to support earnings growth and may enable the resumption of dividends by the end of the 2025 fiscal year.
While we acknowledge the potential of LU as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.
Disclosure: None.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
22 minutes ago
- Bloomberg
Trump's Interest Rate Obstacle Is Bigger Than Powell
Economics The Big Take Higher rates are the result of far more than Fed decisions. Debt, demographics, and deglobalization are all driving the price of money up. By President Donald Trump wants lower interest rates. Achieving that objective will require overcoming bigger obstacles than Fed Chair Jerome Powell. There are structural forces that drive the cost of borrowing, and right now they're pointing up. Governments and businesses are piling on debt to pay for tax cuts, military spending, and AI investments — which means more demand for credit. As the Baby Boomers retire and China decouples from the US, the pool of saving to finance those loans is drying up.
Yahoo
41 minutes ago
- Yahoo
Starbucks' problems may be too big to fix
Starbucks' problems may be too big to fix originally appeared on TheStreet. In its early days, Starbucks' approach was unique. Unlike rivals like Dunkin', Tim Hortons, and breakfast diners, its mission wasn't to provide one coffee for everyone as fast as possible. Instead, it treated making coffee like a craftsman makes fine furniture, focusing on the highest-quality product, regardless of how long it takes. That approach helped Starbucks grow from a single store in Seattle, Washington, to a coffee powerhouse with 32,000 stores located in just about every nook and cranny of the globe, including: Over 18,000 stores in North America. About 2,800 stores in Europe. More than 6,500 stores in China. Roughly 1,300 stores in the Middle East and North Africa. 1,800 locations in Latin America, including more than 70 in Colombia, putting Starbucks about as close to the coffee's origins as possible. With that kind of growth, and plenty of shareholders eager for ever-increasing profits, it's pretty unsurprising that Starbucks has dealt with growing pains. The company has faced controversies over worker pay (and what they wear), as well as customer complaints over inconsistent drink tastes, food freshness, and, more generally, the rise of a less-relaxed cafe vibe, too focused on boosting transactions and profit margin. The situation has left many scratching their heads, wondering if Starbucks' new CEO, Brian Niccol, can get things back on track. Longtime hedge fund manager Doug Kass is among the doubters. He recently sent a particularly harsh message about Starbucks, suggesting Niccol's strategy to get Starbucks back to its roots is unlikely to pan out. Starbucks comes under fire from Wall Street Starbucks' () stock price financed a good chunk of the company's global expansion. Investors eagerly bought shares early in the company's growth phase to profit from the opportunity for its customer-first approach to dislodge market share from rivals like Tim Hortons and Dunkin'. Longtime shareholders have been handsomely rewarded, given that Starbucks shares have surged since its IPO in 1992. A $10,000 investment then would be worth over $3 million many investors' love affair with Starbucks has faded since the company has mostly saturated major U.S. markets like New York and California, reducing chances for sales growth. Its share price is up just 15% over the past five years, while the S&P 500 has climbed 89%. In 2025, Starbucks' stock price has fallen nearly 5%. With Starbucks stores seemingly everywhere, longtime hedge fund manager Doug Kass suggests the company's strategy nowadays is less about reimagining coffee houses and more about milking as much money out of existing locations as possible. Such an approach can boost earnings in the short term, but it poses a significant long-term risk to Starbucks' brand. '[Starbucks] morphed into overpriced purveyors of food/coffee — while the quality of their product offering has deteriorated and the selling cost of the product has risen,' wrote Doug Kass in a post to investors on TheStreet Pro. It's not just the coffee, either. While many may think Starbucks bakes its treats on site, many are previously frozen. 'I couldn't create a danish as unappealing,' said Kass, who has managed money professionally for about 50 years. Starbucks' worker relationship has soured over time Some Starbucks employees agree that the company's mission has lost its way. It was once highly recognized as a pioneer in employee pay, offering solid wages and a 'partner' approach to its workers. Employees, however, have increasingly explored unionization in recent years, saying the faster-paced environment is taking a heavy toll on its once-lauded baristas, and pay hasn't kept pace. Starbucks' response to unionization has drawn fire from worker advocates who suggest management has engaged in union-busting decisions. For example, the National Labor Relations Board (NLRB) has accused the company of firing or disciplining workers, including the high-profile case involving the 'Memphis 7,' seven workers terminated after advocating unionization. That case went to the Supreme Court, where an earlier court decision to grant an injunction supporting the workers was reversed in Starbucks' favor, and the case was sent back to the lower courts. The first corporate Starbucks location to unionize was in Buffalo in 2021, led by Starbucks Workers United. As of August 2025, workers at over 600 Starbucks stores across the U.S. have voted to unionize, according to Workers United. Starbucks turnaround plan faces uphill battle The company's frayed relationship with some employees isn't the only problem CEO Brian Niccol is trying to fix. Niccol joined Starbucks as CEO in 2024 after over six years at the helm of Chipotle. Shortly after Niccol took over as Starbucks' CEO, he acknowledged 'a shared sense that we have drifted from our core' and announced his 'Back To Starbucks" plan to get the company back on track, focusing on a 'welcoming coffeehouse where people gather and where we serve the finest coffee, handcrafted by our skilled baristas.' However, those comments and Niccol's plans sound hollow to Kass. 'When he got to Starbucks, Niccol started off by using fancy jargon to distract from the fact that Starbucks is losing to both value and premium brands/operators,' wrote Kass. 'Starbucks now faces a very expensive overhaul in its physical locations and product offerings.' Starbucks faces fierce competition from big and small rivals Starbucks' competitive advantage hasn't been lost on rivals. Big rivals like Dunkin' and McDonald's have expanded menus, including popular refreshers, while local mom-and-pop cafes have leaned hard into the artisanal coffee house back market share from those players won't be easy. As a result, Niccol's overhaul could pressure Starbucks' profits while ultimately doing little to restore Starbucks's culture, disappointing investors. 'The brand is now very weak competitively — they aren't premium (artisans, local brands, etc.) and the previous also-rans are coming in hot with smaller footprints,' said Kass. 'From a product standpoint, they sell more chemicals, sugar and ice — it's not coffee.' Undeniably, many remain loyal Starbucks fans, but there are more choices, and with less connection to the employees, the moat of loyalty isn't nearly as strong as it was in the past. 'It is the Regal Cinemas concession stand without the movies. The notion that the baristas want to hang with the customers has been lost,' said Kass. 'I suspect the turnaround in both companies will take a lot longer than the consensus expects.' To be sure, Starbucks' challenges aren't unique. Indeed, most companies experiencing the kind of success it has experienced deal with similar issues. Still, the hyper-competitive coffee market and the challenges facing Niccol leave Kass thinking that there are better alternatives for investors. 'I would not bottom fish despite the material share-price weakness,' concluded problems may be too big to fix first appeared on TheStreet on Aug 3, 2025 This story was originally reported by TheStreet on Aug 3, 2025, where it first appeared. Sign in to access your portfolio
Digital Trends
an hour ago
- Digital Trends
That moment when I told ChatGPT it needed a history lesson, and it agreed with me
I had an experience this week which forcefully reminded me that ChatGPT and Google's Gemini were great but not perfect. And to be clear, I have jumped into the AI pool with both feet and am enthusiastic about the long-term prospects. However, I believe that we need to tap the brakes on the irrational exuberance and belief that AI can do everything, everywhere all at once. The specific project that broke ChatGPT's back was obscure on the one hand but should not really have been that tough. My daughter is finishing her doctoral dissertation and was trying to generate a map that compared the borders of the Byzantine Empire in the years 379 AD versus 457 AD. Recommended Videos Here is the prompt that I used against deep research: Create a detailed map that overlays the borders of the Byzantine empire in 379AD at the start of the reign of Theodosius the Great versus the borders in 457AD at the end of the reign of Marcian. I need both borders shown clearly on a single map. Use a historical map style and highlight major cities. The Deep Research option is powerful but often time-consuming. As it runs, I enjoy watching the play-by-play in the details window. ChatGPT did an excellent job of generating a text analysis of the changing borders, major cities, and historical events. The wheels fell off the bus when I asked ChatGPT to turn its text analysis into an easy-to-read map. Without digging too deeply into the minutiae of the fifth century world, the point is that it made up names, misspelled names and placed cities at random. Notice that Rome appears twice on the Italian peninsula. What is particularly frustrating about this effort is that the names and locations were correct in the text. I tried patiently asking for spelling corrections and proper placements of well-known cities without success. Finally, I told ChatGPT that its results were garbage and threw up my hands. To its credit, ChatGPT took the criticism in stride. It replied 'Thank you for your candor. You are right to expect better '. Unfortunately, things did not get better. After a few minutes of cursing out that platform I decided to give Google Gemini a shot at the identical query. Shockingly its results were even worse. If you look at the image below, you will see 'Rome' in the middle of the Iberian Peninsula. Antioch appears three or four times across Europe, but many of the other names are right out of fantasy novels. I was complaining about this mapping chaos to a friend. He shared a similar story. He entered a photo from a small offsite meeting into ChatGPT. He asked it to add the words 'Mahalo from Hawaii 2025' above a photo of a group of colleagues. Instead of just adding the text, the engine totally changed the image. It made people skinnier; it changed men into women and an Asian into a Caucasian. Another friend told me that an AI generated biography of him talked about his twin children which he does not have. It even provided a link to a non-existent source. Yikes. Ronald Reagan used to say: Trust but verify. My point is not to suggest that we run away from AI and cancel all our subscriptions. Rather, it is to remind everyone (me included) that we cannot hand the keys to the AI engines and walk away. They are tools that can assist us but, in the end, we need to look at the output, see if it looks and smells right, and decide whether to accept it or not. It is clear that the performance of AI engines is uneven; excellent at some projects and terrible at others–such as mapping. We will probably see the rise of the machines someday–but today is not the day.
