BYD Co, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Eunice Lee from Bernstein maintained a Buy rating on the stock and has a HK$130.00 price target.
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Eunice Lee’s rating is based on BYD Co’s strong overseas performance and growth potential. Despite a challenging domestic market, the company has shown significant traction in international markets, with overseas wholesale volumes increasing by 145% year-over-year and 25% quarter-over-quarter. This growth is particularly evident in Europe, where markets like Turkey, the UK, and Spain have seen substantial increases in demand, supported by the introduction of plug-in hybrid vehicles.
Furthermore, the overseas operations are more profitable, with net profit per vehicle estimated to exceed RMB 25,000. While the domestic market has faced margin pressures due to aggressive pricing and increased capital expenditures, the robust performance abroad and the potential for continued expansion underpin the Buy rating. Eunice Lee maintains a constructive outlook on BYD, supported by these international successes and the company’s ability to stabilize its domestic market share.