Why Tiger Brokers (TIGR) Might Be the Sleeping Giant About to Explode—And Investors Are Missing the Signal!

UP Fintech, better known in the trading world as Tiger Brokers (ticker: TIGR), recently found itself in the regulatory spotlight alongside FUTU — a topic I delved into yesterday. But honestly, TIGR feels like the simpler puzzle here, with cleaner numbers and a story that’s a tad easier to unravel. So, could this be one of those rare chances where the market’s shaken fear actually masks genuine opportunity? Before diving deep, let’s set the stage with some key financial nuggets, all neatly served in USD, to see if TIGR’s current dip is a distressed gem or just a fleeting tumble. After all, when a company posts solid earnings, a clean balance sheet, yet the shares barely budge — doesn’t that make you wonder what’s really going on under the hood? Ready to find out? LEARN MORE

UP Fintech or better known as Tiger Brokers (ticker: TIGR) were also the other company that was penalized together with FUTU, which I wrote about yesterday.

But I think TIGR is actually cleaner and easier to make sense of. So let’s see if we have a good opportunity here.

Just some information for us to take note of before we go deeper in. All numbers in USD.

TIGR Share Structure: 1 ADS = 15 Class A Ordinary Shares

Price Profile before and after drop

Balance Sheet (Dec 31, 2025)

Enterprise Value

Remember the enterprise value but first, by this time, it is likely the convertible bonds would be paid off. In their last result note 9 it was stated that a few of the convertible loans will come due:

In March and April 2026, Tiger would have repaid $100M principal + accumulated interest of the convertible bonds.

So today, the remaining debt is likely closer to ~$62M and company cash is ~$691M. The enterprise value will remain unchanged since they would take the cash to pay the convertible loan.

Earnings & Valuation

I think if the effect is not significant, TIGR looks damn cheap. They like pricing as if the business has no free cash flow or their earnings is damn volatile like a construction company.

Proposed Penalty and Confiscation Amount

We want to see the one-time impact to TIGR relative to their financials:

USD 57 million is well within TIGR’s FY2025 net income. Their FY 2026 and FY 2027 earnings would look poor after accounting for this penalty but in a way its not a big deal for them.

The bigger issue is how winding down the Mainland Chinese account permanently within 2 years would affect current valuation.

Why TIGR May have Less Uncertainty Compared to FUTU

FUTU’s main issue is that we cannot see a clear revenue segmentation by country. They either group their revenue or accounts by HK Entity and others.

In this way, we cannot clearly consider how much of their HK Entity is exactly account holders with a Mainland China domicile. If that is the case, then it is a struggle for us to evaluate if we are overpaying at current price.

In contrast, TIGR is cleaner:

It is likely that assets directly drive revenue. Interest income scales with assets under custody, margin income scales with borrowing balances, and commission volume correlates with portfolio size.

So given this we know likely how much assets would be wound down.

TIGR’s Past Revenue Growth

I think given that most of the costs are likely fixed, aside from COGS, we may be able to calculate the revenue impact and also the impact potentially to FY 2026 and FY 2027 earnings if this 10% of assets are closed off.

But first, we want to review how the revenue has been to have a certain gauge of what revenue growth we want to put into our model.

Here is TIGR’s Revenue Growth (and also their earnings progression:

FY2019→FY2025 CAGR (since IPO): Revenue +48% / year; Net income (from first profitable year FY2020) +44% / year.

We can group the revenue growth into 3 phases:

• Phase 1 (Pre-IPO to 2021): Commissions were 56–77% of revenue. Growth came from adding mainland Chinese + Singapore accounts trading US and HK equities. Interest income was negligible (near-zero rate environment).
• Phase 2 (2022–2023): Commissions collapsed as retail market volumes dried up (−26.5% YoY in 2022). Rising interest rates saved the P&L — interest income surged from $70M to $149M, reaching 55% of revenue by 2023. This masked the structural damage from the CSRC new-account ban.
• Phase 3 (2024–2025): Commission recovery (+72% from trough) combined with continued interest income growth and a surge in wealth management/other revenue (+163% in 2025). HK market tripling in client assets.

If we look long term, TIGR like FUTU can grow their commission and fee revenue remarkably. As seen in 2022, revenue can also decline as markets take a turn for the worse. If the idea are these things evens out over time with markets going up more than going down then we should be looking at pretty good growth rates.

A Sensitivity Analysis over the FY 26, and FY 27 Valuation

We can try to assume that the non-China revenue to be 90% of FY 2025 revenue. That will be ~$551 million.

The mainland China revenue will wind down separately. this works out to be 50% of ~$61 million. In FY 2027, there will be zero mainland China revenue contribution. The amount of diluted ADS shares to be the same.

We will use the reference price per share of $4.36.

Revenue build:

• FY2026 total = Non-China × (1 + g%) + $30.6M
• FY2027 total = Non-China × (1 + g%)² + $0

Yet at the same time, we will be using FY2025 variable and fixed cost assumptions. I can always assume fixed net margins but in simulations, fixed net margin will make the valuations more pessimistic than optimistic. This is because there are some operation leverage involved.

FY2026 (Mainland wind-down to $30.6M + penalty year)

We are doing revenue test for revenue growth from 10% to 40%. All of these revenue growth rates lower than a lot of the past revenue growth rates.

FY 2026 will include the one time penalty.

FY2027 (Mainland fully exited + no penalty + $310 million fixed costs)

Here’s how FY2027 valuation will look like:

Damn the PE is really like Singapore construction companies with volatile order book business. We are comparing this against:

• HOOD: 35x
• IBKR: 35x
• UOB Kayhian: 15x
• Schwab: 18x
• iFAST: 24x

FY2027 Enterprise Value / Net Income — Updated for Cash Build from FY2026

I decide to do something more: A variation of enterprise value divide by EBIT when things stabilize in FY2027. It is a harsh measure to consider taking out the cash and considering the debt. In TIGR’s case since they have so much cash, their Enterprise Value today ends up lower.

We consider:

1. All convertible bonds mature by May 2026 (debt becomes $0, cash reduces by $62 million)
2. We consider 50% of FY2026 post-penalty net income accumulated as cash in FY 2027.

The result is the following:

I don’t know about you but that looks like some absurdly low numbers.

TIGR’s Cash History

When I see this kind of thing, I try to do some due diligence if the income does translate to cash. In a way, the cash should increase all else equal.

The following table shows the net income, cash + perm deposits. debt, net cash and change in net cash. This does not include the client-segregated regulatory cash:

If you observe, the FY2022–FY2024 net income converts nicely to cash. The FY2025 cash is odd because it increased by double.

This is because Tiger raised $107.8M gross in a share issue at $6.25 in October 2024. This $107.8M flows into the FY2024 balance sheet. Net proceeds ~$100M after fees.

Actually this is the odd thing that they raise that much cash… when they do not need to.

They aren’t buying back stocks but raising cash, not sure for what reason.

Epilogue

I think aside for the questionable decision over raising cash, most of the number checks out.

The thing is there are enough people trapped in Tiger, probably way longer than FUTU ever was. And that is something that you should take note.

I think you can understand how odd this is:

1. There are earnings.
2. The balance sheet is clean.

Why aren’t the share price moving? What is it waiting for? What are the catalysts?

If what I say is correct eventually 2 years later, are you saying that at less than 1 times EV/NI, it will still remain at this price?

It is a good question that we will revisit later.

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Kyith is the Owner and Sole Writer behind Investment Moats. Readers tune in to Investment Moats to learn and build stronger, firmer wealth foundations, how to have a Passive investment strategy, know more about investing in REITs and the nuts and bolts of Active Investing.

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Kyith worked as an IT operations engineer from 2004 to 2019. Currently, he works as a Senior Solutions Specialist in Fee-only Wealth Advisory Firm Providend. All opinions on Investment Moats are his own and does not represent the views of Providend.

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