[Summary]
The stock price of UP Fintech Holding Limited (NASDAQ: TIGR, commonly known as Tiger Brokers) was heavily sold on May 22, 2026.
The immediate source of this is that the China Securities Regulatory Commission (CSRC) has issued advance notice of administrative sanctions against related entities such as Tiger Brokers (NZ) Limited, Fudu Securities International, and Nagahashi Securities, regarding illegal cross-border securities operations within mainland China.
The difficult point here is that TIGR's performance in 2025 itself was strong. Sales increased 56.3% year-on-year to $612 million, and net income increased to $171 million. Even so, the reason why the stock price collapsed was because the market suddenly began to factor in the ``forced reduction of business in mainland China'' and the ``risk of fines and confiscation,'' rather than ``deteriorating business results.''
First, the conclusion
TIGR looks pretty cheap if you just look at the numbers.
Diluted EPS in 2025 was $0.927 per ADS. As of May 22nd, the stock price has fallen to the $4 level, so the simple trailing P/E ratio has fallen to around 5x.
However, it is dangerous to short-circuit the idea of ``buying because it is cheap'' here. This sharp decline is not due to a misreading of profit levels, but rather because the market has priced in the possibility that some parts of the business may no longer be usable due to regulations.
When looking at TIGR, it is better to divide the points into three categories:
| Points of discussion | Perspectives |
|---|---|
| Performance in 2025 | High growth in sales, profits, and customer assets |
| Chinese regulations | Illegal cross-border business bound for the mainland is subject to punishment |
| Second half of 2026 | Focus is on whether China risk can be absorbed through overseas growth |
It's a cheap stock. However, the reason for the low price is also clear.
What happened?
On May 22, 2026, Chinese media reported that the CSRC had investigated the domestic and foreign related entities of Tiger Brokers (NZ) Limited, Fudu Securities International, and Nagahashi Securities as illegal cross-border exhibition business cases, and had issued advance notice of administrative sanctions.
According to reports, the issue was that the company had been providing services such as securities marketing and order processing in mainland China without obtaining permission to operate securities brokerage or margin trading operations, thereby earning revenue. In addition, violations related to fund sales and futures brokerage operations were also cited.
On the same day, it was also reported that eight departments, including the CSRC, will intensively organize illegal cross-border securities, futures, and fund operations over a two-year period. The points are quite heavy.
| Regulation items | Contents |
|---|---|
| New solicitation | Prohibition of illegal solicitation and sales within mainland China |
| Trading services | Account opening, order processing, fund transfer, etc. are prohibited |
| For customers with large amounts of money | During the intensive recovery period, buy orders and capital inflows will be suspended, and only sales and capital outflows will be allowed. |
| Period | Set a 2-year intensive treatment period |
| Final status | After the expiration of the period, we aim to completely suspend the mainland site, trading software, and related services |
This is not just a warning. These regulations go quite deeply into the business model of overseas online securities companies that have been catering to individual investors in mainland China.
Why was it sold even though it was performing well?
TIGR's 2025 performance looks pretty strong on the surface.
| Indicators | 2025 results | Year-on-year comparison |
|---|---|---|
| Sales | $612 million | +56.3% |
| Net profit | $171 million | +181.4% |
| Non-GAAP net income | $187 million | +164.7% |
| Customer assets | $60.8 billion | +45.7% |
| Number of depositing customers | 1,253,900 | +14.8% |
Normally, this number would easily be evaluated as a growth securities company. In fact, fee income, interest income, and wealth management/IPO-related income are all increasing.
Still, the reason stock prices collapsed was because the quality of future profits became doubtful.
Online brokerage revenues are generated from customer base, trading volume, margin trading balances, and cash balances. If mainland China's high-volume customers go in the direction of "can't buy, can't make deposits, and ultimately stop service," some of their customer assets and trading activity will be lost over time.
The amount of fines and confiscation of illegal gains have not been finalized at the time of writing. In other words, the market discounted future revenue sources and regulatory costs at the same time, rather than single-year profits.
TIGR's profit structure
UP Fintech's revenue can be broadly divided into four parts.
| Earnings items | 2025 | Sales composition ratio | Contents |
|---|---|---|---|
| Commission income | $267 million | 43.6% | Trading fees for stocks, options, futures, etc. |
| Interest income | $257 million | 42.0% | Margin trading, securities lending, customer funds related |
| Other income | $78 million | 12.7% | Wealth management, IPO allocation, foreign exchange, etc. |
| Finance services fee | $1.1 billion | 1.7% | Related financial services income |
We are not a fee-only company. Interest income is also large, and the structure is such that the more customer assets increase, the stronger the profit source becomes.
On the other hand, this model is vulnerable to regulation. This is because the premise is that users can freely deposit money, buy and sell, and use margin trading. If trading restrictions are introduced, it will have an effect on fees and interest income.
Internationalization is really progressing
The company is emphasizing the progress of its internationalization strategy in its 2025 financial results.
In Singapore, where the company's head office is located, customer assets increased by more than 50% compared to the previous year, and customer assets also increased significantly in Australia, New Zealand, and Hong Kong. The 20-F also explains that the New Zealand, US, and Singapore subsidiaries accounted for over 88.2% of total sales in 2025.
This is TIGR's strength. It is moving from being a securities app limited to mainland China to a global securities platform with licenses in multiple regions.
However, what investors want to know is not just whether the overseas market is growing.
More importantly,
Even if profits from mainland China disappear, can profits be maintained through overseas growth alone?
It is.
This answer is not completely answered yet. That is why the 2026 1Q financial results scheduled for June 2, 2026 are important.
Valuation is low, but it is cheap with a reason
Diluted EPS in 2025 is $0.927. If the stock price is in the $4 range, the actual P/E ratio will be around 5x.
On the surface, it's pretty cheap. Considering the sales growth rate, net profit growth rate, and growth in customer assets in 2025, it would not be surprising to see a higher multiple for ordinary fintech stocks.
However, this time it was no ordinary performance evaluation.
| Bullish factors | Caution factors |
|---|---|
| Sales and profits in 2025 are at record high levels | Risk of liquidation of business for mainland China |
| Customer assets expanded to $60.8 billion | Fines and illegal income confiscation amount undetermined |
| Growth in Singapore, Hong Kong, Australia, and NZ | Risk of lower transaction volume for mainland customers |
| Actual PER is low | Possibility of a value trap where low PER is prolonged |
What the market is afraid of is not past EPS, but how far future EPS will be reduced.
Scenario for the second half of 2026
In the TIGR in the second half of 2026, regulatory events will be resolved and overseas growth will be confirmed at the same time.
Bullish scenario
In the bullish scenario, it is confirmed that the amount and scope of administrative penalties will be within market expectations, and that the impact on profits from mainland China will be limited.
In addition, if customer assets and the number of depositing customers continue to grow in countries such as Singapore, Hong Kong, Australia, and New Zealand, the market may be reconsidered as a ``digital securities company growing in overseas local markets'' rather than a ``brokerage company dependent on mainland China.''
In this case, it is easy to see that the stock price in the $4 range was oversold.
Neutral scenario
In the neutral scenario, although the penalties are heavy, they are not enough to damage the company's finances, and overseas growth continues. However, the P/E ratio will not recover easily as the memory of China risk remains.
Even if a company's business performance is good, stock prices tend to be pushed to low valuations while investors wonder if another round of regulation will come.
Bearish scenario
In a bearish scenario, the actual amount of illegal income confiscation and fines will be higher than market expectations, and fee and interest income will visibly fall due to trading restrictions for high-volume customers.
Furthermore, if there is a slowdown in the number of depositing customers, customer assets, and trading volume in the 1Q of 2026, the low P/E ratio will not be interpreted as ``undervalued,'' but as ``taking into account the peak out of profits.''
In this case, even if the stock price rebounds in the short term, the upside tends to be heavy.
KPIs that investors should check
If you look at TIGR, you want to follow the following numbers.
| KPI | Why is it important |
|---|---|
| Number of depositing customers | View ability to acquire new customers |
| Customer assets | Becomes the base of interest income and transaction volume |
| Trading volume | Directly linked to fee income |
| Margin/Securities lending balance | Source of interest income |
| Customer assets by region | Confirming decline in dependence on mainland China |
| Amount of disposal/confiscation | View one-off losses and impact on capital |
| Comments on 2026 1Q financial results | Check initial reaction to regulatory impact |
Regional data is especially important. Just saying that overseas sales are growing is not enough. We need to see how much growth in each region is compensating for the contraction in mainland China.
Summary
The sharp decline in TIGR cannot be explained solely by deteriorating business results.
In fact, the numbers for 2025 are strong. Sales, net income, customer assets, and number of depositing customers are all increasing. That's why the stock price of around $4 and the actual P/E of around 5 times looks quite cheap at first glance.
However, the essence of this case is Chinese regulations.
The cross-border exhibition industry, which the CSRC viewed as a problem, cannot be separated from TIGR's past growth story. The two-year intensive restructuring period, restrictions on buy orders and capital inflows, and the eventual suspension of services to the mainland are quite heavy on online securities.
In a nutshell, the focus for the second half of 2026 will be ``Can we override China risk with overseas growth?''
There is room for a backlash. However, this is not simply a stock to buy on the spur of the moment. It is a high-risk stock that should be viewed very carefully while waiting for confirmation of regulatory disposition, 1Q financial results, and regional growth.
Source
This article was created based on UP Fintech's disclosure materials, reports on Chinese authorities' announcements, and market data.
- UP Fintech 2025 Full Year/4th Quarter Financial Results (Form 6-K)
- UP Fintech 2025 Annual Report (Form 20-F)
- [China News News "Confirmation page 2026/05-22/10626694.shtml"
- China News News "China News 2026 Full-scale Retirement of External Machinery Non-legal Cross-Border Confirmation Term Cost Fund Activation"
- MarketScreener "UP Fintech Holding Limited to Report First Quarter 2026 Financial Results on June 2, 2026"
- Confirmation date: 2026-05-23