CHA · Chagee Holdings

The thesis

Chagee Holdings is more likely to lag the S&P 500 over the next three months. The $1.95 special dividend declared on 12 November 2026 hands back cash, but the core China tea business was still shrinking in the latest reported quarter. The third-quarter report, expected around 27 November 2026 by market calendars, shows whether China same-store sales have turned.

The case rests on the second quarter. Chagee's 28 August 2026 results showed Greater China same-store gross merchandise value (GMV, the value of drinks sold through its teahouses) down 16.1% from a year earlier. Average monthly GMV per Greater China teahouse fell to RMB338,259 from RMB404,352 a year earlier and from RMB356,080 in the first quarter. Active members fell to 47.1 million from 50.0 million in the first quarter. Those are falling numbers, and the shares closed at $13.51 on 12 November 2026, up 31.5% over three months.

The price now includes a $1.95 cash payment to holders of record at the close on 23 November 2026, which leaves the quoted price once the shares go ex-dividend. What is left prices in a recovery in China sales that the second-quarter numbers did not show. The rating is Low because the dividend counts the same in total return whether the business recovers or not. The next sales figures decide the case.

Bullish and bearish views on Chagee Holdings Limited

The bull case on Chagee Holdings Limited (CHA), in brief: large cash return, now made policy. The bear case: China same-store GMV still falling.

Bull case

• Large cash return, now made policy. The board declared a special dividend of about $1.95 per American depositary share (ADS) on 12 November 2026. It also adopted a policy to pay at least 50% of the prior year's net income each year for three financial years, starting with the year ending 31 December 2026 for payment in 2027, according to the company's 6-K.
• Profit rebuilt despite flat sales. Second-quarter 2026 operating income was RMB524.7 million, up 387.6% from RMB107.6 million a year earlier, on net revenues of RMB3,414.6 million, up 2.5%, according to the 28 August 2026 results.
• Overseas growth is fast. Overseas GMV was RMB504.0 million in the second quarter of 2026, up 114.3% from a year earlier, across 399 overseas teahouses at 30 June 2026.
• A buyback runs alongside the dividend. The company authorised up to $150 million of ADS repurchases over twelve months from 1 June 2026. By 24 August 2026 it had bought about 2.57 million ADSs for $29.5 million.
• Analysts have turned more positive. Jefferies raised the shares to Buy from Hold on 21 October 2026 and lifted its target to $14.90 from $11.80.

Bear case

• China same-store GMV still falling. Greater China same-store GMV fell 16.1% from a year earlier in the second quarter of 2026. Greater China GMV was RMB7,156.3 million against RMB7,867.9 million a year earlier.
• Per-store sales weakened from the first quarter. Average monthly GMV per Greater China teahouse fell to RMB338,259 in the second quarter of 2026 from RMB356,080 in the first quarter, according to the 28 August 2026 results.
• Adjusted profit fell. Non-GAAP net income was RMB488.7 million in the second quarter of 2026 against RMB629.8 million a year earlier. Non-GAAP diluted earnings per share fell to RMB2.54 from RMB3.30.
• Cash pile is shrinking. Cash, restricted cash and time deposits were RMB6,795.5 million ($1,001.5 million) at 30 June 2026, down from RMB7,892.4 million at 31 December 2025. That was before the buyback continued and before the special dividend is paid.
• Overseas is still small. Overseas GMV of RMB504.0 million was a small part of total second-quarter GMV of RMB7,660.3 million. Overseas same-store GMV also fell 15.1% from a year earlier.

Price setup

The shares closed at $13.51 on 12 November 2026, up from $12.33 on 11 November 2026, in the session the special dividend was announced. They had traded between $12.28 and $12.57 at the close from 5 November to 11 November 2026. The 3-month change is 31.5%, from a reference close of $10.27 on 14 August 2026.

On adjusted daily closes, the shares sit above both the 50-day moving average of $12.06 and the 200-day moving average of $11.16 as of 12 November 2026. The 52-week intraday high is $16.56 on 2 December 2025, and the last close is 18.4% below it. The 52-week closing low is $9.16 on 1 April 2026. The ADS priced its initial public offering at $28.00 in April 2025.

The special dividend changes how the chart reads after 23 November 2026. The quoted price should drop by roughly the $1.95 payment when the shares go ex-dividend. Adjusted closes will scale earlier prices down by the same payment, so the 3-month comparison with the index stays on a total-return basis.

Catalysts ahead

• 23 November 2026: Record date for the $1.95 special dividend. The payment leaves the quoted price when the shares go ex-dividend. Price moves after this date have to be read net of the payment.
• ~27 November 2026 (est.): Third-quarter 2026 results (date estimated by market calendars, not yet confirmed by the company). Shows whether Greater China same-store GMV and per-store sales recovered from the second quarter's 16.1% decline. That recovery is what the share price already assumes.
• ~4 December 2026 (est.): Payment of the $1.95 special dividend. Lowers the cash balance, which stood at RMB6,795.5 million on 30 June 2026, and reduces what is left for the buyback and for expansion overseas.

What would change the view

A daily close above $14.00, about 4% over the 12 November 2026 close and harder to reach once the $1.95 dividend leaves the price, which would show the shares leading; or a third-quarter report with Greater China same-store GMV down by less than 10%.

What it trades with

Chagee earns most of its GMV in Greater China: RMB7,156.3 million of RMB7,660.3 million in the second quarter of 2026. The shares therefore trade with China consumer sentiment and with other US-listed Chinese consumer stocks more than with the S&P 500. Revenue and profit are reported in renminbi, so the dollar price of the ADS also moves with the exchange rate. From late November to early December 2026, the dividend record date, the expected third-quarter report and the payment fall close together. Price moves in that period will mix the dividend adjustment with the market's reaction to results.