Atour Lifestyle: Upgrade to Buy Amid Retail Growth and Improved Hotel Dynamics

Atour Lifestyle Holdings Limited (ATAT) has been upgraded to a "Buy" rating by a finance expert with experience at Bloomberg. The upgrade is due to favorable developments in retail operations and hotel dynamics, despite initial concerns about tariff-related challenges. The stock is now worthy of a bullish view, according to the expert.

Atour Lifestyle Holdings Limited (ATAT) has been upgraded to a "Buy" rating by a finance expert with experience at Bloomberg. The upgrade is attributed to favorable developments in the company's retail operations and hotel dynamics, despite initial concerns about tariff-related challenges. The stock is now deemed worthy of a bullish view, according to the expert.

The retail division of ATAT has shown solid momentum, with its bedding brand "Yaduo Planet" (YP) ranking among the top three in terms of homecare category sales during China's mid-May to mid-June "618 Festival" this year. Gross Merchandise Value (GMV) for YP rose by four-fifths year-over-year (YoY) to CNY 0.7B, as reported by local media portal Sina on June 21 [3]. Additionally, the next generation of YP's padded blanket offering, "Deep Sleep Slightweight Comforter 2.0," sold over 0.3M units during the same event, a 76% increase from the previous year's volume [3].

The company lifted its retail segment's full-year 2025 topline expansion guide from +35% to +50% in late-May [3]. This upward revision suggests that the company's retail operations are performing better than initially projected.

In the hotel sector, ATAT has been positively impacted by the potential entry of JD.com into the hotel and flight bookings market. JD.com plans to introduce a three-year membership program that waives commissions for the accommodation sector, which could exert downward pressure on the take rate charged by incumbent Chinese OTAs such as Trip.com [3]. This development could be a tailwind for ATAT's hotel unit, which represents 61% of its latest Q1 top line [3].

Overall, the combination of strong retail performance and potential benefits from increased competition in the hotel sector has led to an upgrade in ATAT's rating to "Buy." Investors interested in Consumer Discretionary stocks should continue to monitor ATAT's performance, as it has shown solid year-to-date returns and a positive earnings outlook trend [2].

References:
[1] https://www.marketbeat.com/stocks/NASDAQ/ATAT/forecast/
[2] https://www.nasdaq.com/articles/are-consumer-discretionary-stocks-lagging-atour-lifestyle-holdings-limited-sponsored-adr-0
[3] https://seekingalpha.com/article/4797373-atour-lifestyle-buy-on-retail-growth-improved-hotel-dynamics-rating-upgrade