One-glance verdict
Undervalued
$5.36 our estimate vs market $1.63
Wall Street consensus: $2.79 (-48.0% lower than our fair-value estimate)
70% below our estimate, below the bear case
Fundamentals snapshot
RLX Technology Inc.
RLX · NYQ · Consumer Defensive · Tobacco
Current price
$1.63
52-week range
$1.58 - $2.60
Market cap
$1.99B
Balance sheet
Healthy
0.59x Concerning
Net cash $1.28B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 50.3% last year.
- Reward Free cash flow was positive in 6/10 years.
- Risk Stock trades 282.0% above its 5-year average P/E.
- Risk Operating margin compressed from 20.1% to 14.2% over 3 years.
What this company does
RLX Technology Inc.
RLX Technology makes and sells e-cigarette products like rechargeable and disposable vaporizers in China and other countries. Their main income comes from selling these products through various distributors and directly to customers. This matters because their sales figures show how popular their vapes are, which impacts their profit margins (the percentage of each sales dollar left after paying for the costs of making and selling the products).
How the company got here
RLX Technology was founded in 2018 with the goal of creating a trusted brand for adult smokers through advanced products and technology. The company began its operations in China, focusing on the development, manufacturing, and distribution of e-vapor products. It has since expanded its reach internationally, navigating a complex regulatory landscape. RLX Technology went public on the New York Stock Exchange in January 2021, aiming to fuel further growth and global expansion.
What it actually does
RLX Technology develops, manufactures, and sells e-vapor products, which are electronic devices that heat a liquid to create an inhalable aerosol, often referred to as vaping. These products are designed for adult smokers as an alternative to traditional cigarettes. The company manages the entire product lifecycle, from initial research and development to the final sale of its goods. RLX Technology also invests in scientific research, particularly in understanding e-liquids and aerosol properties, to enhance its product offerings and ensure safety.
E-vapor Products
This is the core business of RLX Technology, encompassing a range of e-vapor devices and related consumables. They offer rechargeable e-vapor products, which consist of a reusable device (like a battery component) and replaceable cartridges filled with e-liquid, under brand names such as Qingyu, Phantom, and Zeus. They also produce disposable e-vapor products, like the Feiliu and Feiliu Mega brands, which are used until the e-liquid is depleted and then discarded. This segment represents the vast majority of the company's revenue, primarily generated from sales within China, though international markets are becoming increasingly important.
Modern Oral Products
RLX Technology is also venturing into the modern oral nicotine products market. These are typically products like nicotine pouches that deliver nicotine without combustion or inhalation. The company has introduced its own line of these products, for example, in the United Kingdom. While this is a newer area for RLX, it represents a strategic move to diversify its product portfolio and tap into different consumer preferences within the nicotine product market.
What management is betting on now
RLX Technology's current strategy focuses on expanding its international presence, particularly in Europe and other Asian markets, as a way to diversify revenue streams and mitigate challenges in its core Chinese market. Management is also prioritizing shareholder returns and capital discipline, meaning they are carefully considering investments and acquisitions based on their potential to generate profit and strategic value. The company is closely monitoring regulatory developments, especially in the U.S., and is adapting to evolving regulations in China, viewing stricter enforcement against illegal e-cigarettes as a long-term positive. Furthermore, RLX is investing in research and development to innovate new products and explore new user segments.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$115.66M
FY2025 Q4
$141.11M
Revenue
$566.11M
Net income
$131.83M
Diluted EPS
0.10
Operating cash flow
$157.95M
Free cash flow
$141.11M
Fetching…
Sources
Revenue
$376.55M
Net income
$75.60M
Diluted EPS
0.06
Operating cash flow
$117.05M
Free cash flow
$115.66M
Fetching…
Sources
Is it cheap or expensive?
Fair value $5.36 vs current price $1.63
Wall Street consensus is the average analyst price target: $2.79 (-48.0% lower than our fair-value estimate).
Our most-likely fair value is $5.36 a share — about 228.9% above today's price of $1.63, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $1.3B - more cash than debt. Interest coverage 0.6x.
Net debt
$-1.28B
Interest coverage
0.59x
RLX Technology Inc.'s profit covers its interest bill about 0.6 times over. which is weaker than most peers shown here.
Healthy
Worse cushion
Baseline
Better cushion
RLX
BASELINE
RLX Technology Inc.
Total debt $36.64M Interest coverage 0.59x This is the baseline the peer rows are being compared against.
Total debt $47.73B Interest coverage 9.41x +1,505% vs RLX Carries about 16.0x more debt cushion than RLX.
Total debt $24.06B Interest coverage 10.23x +1,644% vs RLX Carries about 17.4x more debt cushion than RLX.
Total debt $47.04B Interest coverage 6.05x +932% vs RLX Carries about 10.3x more debt cushion than RLX.
Total debt $310.67M Interest coverage 3.76x +541% vs RLX Carries about 6.4x more debt cushion than RLX.
What you should know
The case for and against RLX
3 Rewards
2 Risks
Rewards
-
Revenue grew 50.3% last year.
-
Free cash flow was positive in 6/10 years.
-
Trades at 14.8x P/E vs peer median 22.4x (33.9% cheaper).
Risks
-
Stock trades 282.0% above its 5-year average P/E.
-
Operating margin compressed from 20.1% to 14.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
14.82x
Forward P/E
9.97x
P/B
0.86x
P/S
0.44x
EV/EBITDA
-9.68x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
34.9%
Operating margin
14.2%
Net margin
21.9%
ROE
6.3%
ROA
2.1%
Health
Liquidity and balance-sheet strength
Debt / equity
0.02x
Current ratio
10.61x
Quick ratio
9.43x
Total debt
$36.64M
Total cash
$1.32B
Growth
How the business has been compounding
Revenue TTM
$1.94B
Revenue 5Y CAGR
-19.3%
EPS TTM
0.11
EPS 5Y CAGR
-13.7%
Cash flow
How much cash the business throws off
Operating CF TTM
$373.56M
Free CF TTM
$141.11M
FCF margin
7.3%
Dividend
Shareholder payout
Yield
6.0%
Payout ratio
106.1%
Last ex-div date
2026-01-26