Lenovo 0992

[winston]

not vested

LENOVO GROUP(992)

Analysis：

During the three months ended December 31, 2021, Lenovo Group（0992）set new performance records in revenue and profit.

Its revenue advanced 17 percent year-on-year to a new milestone of US$20.1 billion, and net income margin reached 3.2 percent, expanding year-on-year for seven straight quarters.

The Intelligent Devices Group (IDG), consisting of the PC, tablet, smartphone, and other smart device businesses, posted a stellar 21 percent annual profit growth and revenue growth of 16 percent.

Its operating margin expanded 31 basis points ye! ar-on-year to a record 7.7 percent.

Empowered by a strong infrastructure upgrade cycle from cloud and enterprise customers, its operating profit increased by US$28 million year-on-year to US$17 million, on revenue growth of 19 percent to US$1.9 billion.

Benefiting from opportunities arising from hybrid working model and commercial recovery, Solutions and Services Group (SSG) revenue grew 25 percent year-on-year to US$1.5 billion.

Operating profit surged by 44 percent year-on-year to US$332 million.

From a mid to long-term perspective, service business is a structural growth engine for the Lenovo Group and will play an increasingly important role in driving the recurring revenue and profitability amid these megatrends.

Strategy：
Buy-in Price: $8.48, Target Price: $9.44, Cut Loss Price: $8.01

Source: Phillips

[winston]

not vested

LENOVO GROUP(992)

Analysis：

During the fiscal year ended March 31, 2023, Lenovo Group's (992) structural growth engines, including its Infrastructure Solutions Group (ISG), and Solutions and Services Group (SSG), set multiple performance records, thanks to its resilient and well-executed transformation strategy.

Profitability, including gross margin and operating margin, reached an 18-year high on strengths of ISG and SSG, which helped mitigate the impact on profitability from smaller scale PC operations.

Revenue for the fiscal year ended March 31, 2023 was US$61.947 billion, representing a year-on-year decrease of 14%, mainly because of excess channel inventory amid falling sell-in demand and currency headwinds that caused revenue of Intelligent Devices Group (IDG), consisting of the PC, tablet, smartphone, and other smart device businesses, to decline 21% year-on-year to US$49.371 billion.

However, ISG revenue grew by 37% to a record US$9.8 billion, marking the third consecutive record-setting year, and operating profit surged to a new high of US$98 million.

SSG revenue and operating profit grew 22% and 16% year-on-year to US$6.7 billion and US$1.4 billion respectively.

SSG's operating margin of 20.9 percent topped all business groups.

Looking forward, the Group expects the PC market might stabilize sooner than many expected in 2023, and at the same time, IDG will continue to drive efficiency in its lean operations, maintain healthy cash generation, and invest in innovation.

(I do not hold the above stock)

Strategy：
Buy-in Price: $7.90, Target Price: $8.80, Cut Loss Price: $7.50

Source: Phillips

[winston]

not vested

Lenovo Group (992 HK)
1QFY24: Results Miss As ISG business Disappoints; Recovery Still Underway

Lenovo’s June quarter results missed our and market expectations with net profit declining
66% yoy to US$177m, primarily due to a worse-than-expected deterioration in the ISG business.

Nevertheless, Lenovo’s results should have hit a trough in the June quarter, and we now expect
a sequential recovery starting from the September quarter.

On the bright side, Lenovo’s AI business saw strong demand with backlog spiking to US$2b
which is a positive surprise.

Maintain BUY. Target price: HK$10.60.

Source: UOBKH

https://research.uobkayhian.com/content ... 69b9e22e6f

[winston]

not vested

LENOVO GROUP Slips 10% in Early Session, Slammed by US Commentary on Newsweek

U.S. Newsweek published an opinion piece by retired U.S. Army General James "Spider" Marks, who argued that the scope of electronic espionage is much wider than most people realize.

He drew an analogy between the earlier balloon incident in Montana and the voluminous Lenovo computers made by China used in U.S. government offices.

He noted that these computers sent messages to the Chinese Communist Party, and advocated legislation to ban them.

The retired general cited a group called China Tech Threat (CTT), which tallied U.S. government agency spending on Lenovo equipment, and the Chinese government is a substantial indirect shareholder of Lenovo.

Yet, he did not mention that CTT is funded by one of Lenovo's biggest rivals, Dell (DELL.US) -0.670 (-0.800%) .

Report revealed that Micron (MU.US) is also known to have funded the organization.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/analy ... stock-news

[winston]

vested

17 Nov 2023

2QFY3/24 loss narrower than expected; PC shipments will take time to recover

Net profit fell by 54% y-o-y due to persistently weak PC and server business demand

Earnings drop is 10% narrower than expected due to margin recovery after PC inventory de-stocking

Cut earnings forecast in FY3/24F and FY3/25F by 18% and 24% to factor in the slower PC and server recovery

Maintain HOLD as we expect PC shipments will take a few more quarters to resume growth

Maintain HOLD with higher TP. Our TP has increased to HK$9.0 (prev. TP: HK$7.4) as we rolled over our benchmark to FY24F BPS.

In the mid-term, we expect earnings to resume growth at 35.9% and 37.7% in FY3/25F and FY3/26F, due to
(1) gradually improving demand in the consumer electronics end market, and
(2) Windows 11 migration.

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=17287

[winston]

vested

Aug 18, 2024

Lenovo Group (992 HK)
1QFY24: Results Miss As ISG business Disappoints; Recovery Still Underway

Lenovo’s June quarter results missed our and market expectations with net profit declining 66% yoy to US$177m, primarily due to a worse-than-expected deterioration in the ISG business.

Nevertheless, Lenovo’s results should have hit a trough in the June quarter, and we now expect a sequential recovery starting from the September quarter.

On the bright side, Lenovo’s AI business saw strong demand with backlog spiking to US$2b which is a positive surprise.

Maintain BUY. Target price: HK$10.60.

Source: UOBKH

https://research.uobkayhian.com/content ... 69b9e22e6f

[winston]

vested

CLSA: LENOVO GROUP (00992.HK) Biz with US Govt Minimal; Shr Drop Provides Buy-in Opportunity

The decline in LENOVO GROUP (00992.HK) 's share price last Friday (26th) may be related to 2 news, CLSA issued a research report saying.

One of the news is Intel Corporation (INTC.US)'s weak guidance for 1FQ24.

Another news is that an organization is said to have suggested the US government to ban LENOVO GROUP's computers.

CLSA said that Intel's guidance, which focused on its server business, could be an individual case.

LENOVO GROUP responded that it had gone through a comprehensive verification. Therefore, CLSA believed that LENOVO GROUP's business with the US government is minimal.

CLSA considered that the volatility of LENOVO GROUP's share price provides a buy-in opportunity and rated Buy on LENOVO GROUP.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/analy ... stock-news

[winston]

vested

M Stanley Downgrades LENOVO GROUP (00992.HK) to Equalweight, Cuts TP to $9.7

While the broker remained optimistic about the personal computer (PC) refresh cycle in 2H24, it expected that a downturn in earnings could put pressure on the group in the near term.

LENOVO will announce its 3FQ results for the fiscal year ending December 2024 on 22 February.

The broker forecasted revenue to be flat YoY at US$15.2 billion, profit before tax to drop 28% YoY to US$435 million and net profit to reach US$323 million, down 26% YoY and 5% below market consensus.

The broker expected that LENOVO may continue to face downward pressure in 4FQ ended March this year due to the continued weak demand for PCs since November last year.

Revenue for 4FQ is expected to grow by 5% YoY to US$13.3 billion, while net profit is expected to hike by 107% YoY to US$235 million, about 18% under the street estimate of US$286 million.

For the full fiscal year, the broker predicted revenue and net profit to fall by 10% and 39% YoY to US$55.8 billion and US$983 million respectively.

Source: AAstocks.com

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

vested

Share price hit by retired US general’s report

A retired US general had urged the US government to ban Lenovo's PCs as he believed they could send sensitive data to the Chinese Communist Party.

We believe the US general’s report reflects his personal opinion and does not present any evidence to support his claims.

Reiterate Add. TP unchanged at HK$10.70, based on 12x CY25F P/E.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... B64755FC66

[winston]

vested

CLSA: LENOVO GROUP (00992.HK) Shr Fall Is Result of Report Misread; Rating Reiterated Buy

CLSA wrote in a report that LENOVO GROUP (00992.HK) shares crashed on Friday (26 Jan) mainly due to a Bloomberg report mentioning a Newsweek article attacking the group.

The broker said the main purpose of the Bloomberg report was to investigate the organisation behind the attack article, China Tech Threat (CTT), which is said to be funded by LENOVO's rival Dell Technologies (DELL.US).

The broker said it did not believe the report was aimed at attacking the security of LENOVO computers, and that the drop in the group's share price was due to the market's misinterpretation of the article.

The broker reiterated its Buy rating and $10.9 target price on LENOVO.

Related NewsCLSA: LENOVO GROUP (00992.HK) Biz with US Govt Minimal; Shr Drop Provides Buy-in Opportunity

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN