Mark Li, an analyst from Bernstein, maintained the Buy rating on Sunny Optical Technology (Group) Co. The associated price target was raised to HK$110.00.
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Mark Li has given his Buy rating due to a combination of factors that highlight Sunny Optical Technology’s strong financial performance and growth potential. The company reported a significant increase in revenue and gross margin in the first half of 2025, driven by a higher mix of premium products such as 6P+ lenses and G+P lenses, as well as robust growth in the automotive segment. This segment, which carries a higher gross margin, outpaced the corporate average, contributing to an overall improvement in profitability.
Furthermore, the company’s expansion into the XR market, particularly with AI glasses, has shown promising growth, positioning Sunny Optical for sustained multi-year expansion. Despite a decline in handset shipments, the average selling price increased significantly, and management expects continued revenue growth in this area. The company’s leadership in smart glasses and early investments in AR are expected to drive future revenue growth. These factors, combined with an expected improvement in corporate gross margin and a revised EPS growth estimate, support the Buy rating assigned by Mark Li.
In another report released yesterday, DBS also maintained a Buy rating on the stock with a HK$110.00 price target.