Name: Why Labubu maker Pop Marts shares are plunging
Uploaded: 2025-12-18T08:01:14.875Z
Duration: 3 min 31 s
Description: A 40% slide in shares of Pop Mart from a peak in August shows growing worries that Labubu mania may be fading. Lackluster US Black Friday sales and cooling resale demand are also reviving comparisons to the 1990s Beanie Babies bust.

A 40% slide in shares of Pop Mart from a peak in August shows growing worries that Labubu mania may be fading. Lackluster US Black Friday sales and cooling resale demand are also reviving comparisons to the 1990s Beanie Babies bust.

Beijing

Pop Mart, known for its Labubu collectibles, has experienced a 40% decline in its share price over recent weeks, raising questions about the company's long-term prospects. The drop comes despite strong first-half revenue growth and ongoing expansion efforts, including a new theme park in Beijing and a reported movie deal with Sony Pictures.

Analysts remain divided on the company's future, with some maintaining bullish price targets while others point to signs of cooling consumer interest. Google search trends and resale market prices for Labubu products have both declined, contributing to increased short interest and a significant drop in Pop Mart's valuation.

Why Labubu maker Pop Mart's shares are plunging

All right. We're going to talk about Labubu's here today, given that it's a pretty quiet day here. But we've been talking about the whole stock of PopMart itself, right? Certainly, when it comes to this 40 percent slump that we see in the shares in the last few weeks or so, it's certainly raising a lot of questions about the company's longer-term prospects, as there's this fear that Labubu mania might be over here. The stock is also trading near record low valuation. In fact, we're back to those sort of troughs that we saw of late. So certainly, it's going to be quite interesting, right? Because maybe it's just a stock story. Maybe people were just running this up, this stock, too high, because when it comes to the growth projects, the fundamentals, they still remain quite extraordinary, right? Yes, it slowed down a bit. When you take a look at the first half revenue, though, that still surged to $2 billion. And when it comes to the sell side, you ask them whether they're still bullish on this stock. Take a look at what we're seeing when it comes to some of the analysts, right? The average 12-month price target for the stock is at HK$359, which is suggesting about an 84 percent above its last close, or at least upside from here. Certainly, that's going to be a key thing to watch very closely right now. And really, I think there's about 44 buys on the stock overall. Let's bring in Lanting, too, our Asia Equities Managing Editor. She joins us from Singapore to talk a little bit more about, of course, this whole PopMart story and the trial and tribulations of the stock itself, right? I mean, we talk about the numbers are still quite extraordinary, but analysts just can't quite determine what the long-term prospects are. Yeah, that's really the biggest concern right now. People are quite obsessed with its short-term numbers. So, the U.S. Black Friday sales was, to them, a big disappointment. As you said, the numbers were not bad. If you look at North America sales quarter to date, it's up more than 400%, but it is considered a big disappointment because the previous quarter we saw double that growth. So, overall, you're seeing investors are being so punishing in the stock market. As you mentioned, the share is down 40% in about four months and short interest tripled from November levels. And if you look at forward P valuation, yes, right now it's at a very depressed 14 times versus 45 times that we saw just half a year ago. And what are, I mean, it seems like there is a bit of debate, right, whether the IP is there. What do we have to look at to determine whether there's going to be like a beanie baby sort of hype that fizzles out or something like a Sanrio Hello Kitty, for example? Yeah, a few things people are watching out for, whether they can be like a Walt Disney or Hello Kitty, as you said. A few things the company actually has been doing. One is opening a theme park in Beijing. That was last year. Second thing is they have reportedly struck a deal with Sony Pictures to produce a La Booboo movie. So, they're trying to do things that can sustain that kind of craze or popularity surrounding La Booboo. But in reality, if you look at Google trend, the searches for the term La Booboo has really been cooling. And if you look at the resale market, the kind of price that a La Booboo dog could command before, like double or triple in the retail price, right now the kind of price is not there. So, that is all correlated right now to its stock price.

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