WeRide’s Strategic Expansion and Cost Efficiency Drive Buy Rating with 87.3% Expected Share Price Return

In a report released today, Jeff Chung from Citi maintained a Buy rating on WeRide, with a price target of $15.30.

Jeff Chung’s rating is based on several promising developments for WeRide. The company is making significant strides in the Middle East, having obtained a fully driverless Robotaxi license in Abu Dhabi. This achievement is expected to drive a substantial expansion of their Robotaxi fleet in the region, with projections of reaching 500 to 1,000 units by 2026. Furthermore, WeRide’s collaboration with Uber is anticipated to enhance their daily order intake, especially as they adjust pricing strategies to be more competitive.
Additionally, WeRide’s management foresees potential cost reductions, particularly in labor, which could improve their financial performance. The company is also focusing on expanding their operational areas and fleet size to increase daily orders. In China, WeRide aims to achieve unit economics breakeven in Shenzhen with a fleet of 5,000 units, although this remains challenging in other cities. These factors contribute to an expected share price return of 87.3%, supporting Chung’s Buy rating.

According to TipRanks, Chung is a 3-star analyst with an average return of 4.6% and a 47.92% success rate. Chung covers the Consumer Cyclical sector, focusing on stocks such as BYD Co, Great Wall Motor Co, and NIO Inc. Class A.