Nomura: Significantly raises Lenovo Group target price to HK$35, maintains "Buy" rating

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Golden Finance reported that on June 29, Nomura issued a report maintaining a "Buy" rating for Lenovo Group. Based on 20 times the forecasted earnings per share for fiscal year 2027, the target price was significantly raised from 16 Hong Kong dollars to 35 Hong Kong dollars. Although Lenovo's stock price has risen over 100% since May, Nomura believes this outperformance may continue because the bank believes: (1) the market has not yet fully reflected the potential of Lenovo's server business; (2) Nomura's earnings forecasts for fiscal years 2027/28 are now about 10% higher than consensus; (3) Lenovo is currently in a revaluation process, and its main peer Dell is trading at 30 times the one-year forward P/E ratio, which Nomura believes creates room for Lenovo's revaluation. The bank raised its earnings forecast for Lenovo Group for fiscal years 2027/28 by 12%.
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