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<Research>Citi Raises XIAOMI-W (01810.HK) TP to $21.9, Lifts Earning Forecast to Reflect Rosier NEV Outlook
Recommend 24 Positive 52 Negative 10 |
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Citi Research wrote in a report that it has raised its adjusted EPS forecasts for XIAOMI-W (01810.HK) by 25%, 37% and 32% for 2024/25/26 due to a better-than-expected outlook for the company's EV business. The broker also raised its EV shipment forecasts to 100,000, 200,000 and 280,000 units for 2024/25/26, compared to the original predictions of 60,000, 131,000 and 252,000 units. Gross profit margin forecasts have been raised to 6%, 9% and 12% for the 3 years respectively, compared to the original -10%, -2% and 11%. Citi commented that key takeaways from XIAOMI's investor day included a sales target of 100,000 SU7s this year, with a gross margin target of 5% to 10%. Orders are now locked in for more than 70,000 units. The break-even point is 300,000 to 400,000 units per year. The decline in smartphone gross margin this year is likely to be manageable. For the full year, XIAOMI aimed to generate revenue of over RMB300 billion, maintain a stable overall gross margin, keep a stable ratio of operating expenses to sales in its core business, ship 15-20 million smartphones, and spend RMB24 billion on R&D. Sales in 1Q24 grew by double digits YoY. The broker added that XIAOMI's long-term goals are to be the No. 1 seller of smartphones in five years, a top 3 seller of tablet PCs in 2025, a top tier brand in the electronics and home appliance industry, a top 5 seller of electric vehicles in 15-20 years, and to have 20,000 retail shops in China by 2026. Citi elevated its target price for XIAOMI from $19.6 to $21.9 and maintained its Buy rating. AAStocks Financial News |
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