Lenovo Group (0992) AI Stock Analysis

• Market Cap: HK$136.20B
• Dividend Yield: 3.55%
• Average Volume (3M): 81.50M
• Price to Earnings (P/E): 10.5
• Beta (1Y): 1.14
• Revenue Growth: 21.51%
• EPS Growth: 50.43%
• Country: HK
• Employees: 69,500
• Sector: Technology
• Sector Strength: 80
• Industry: Computer Hardware
• EPS (TTM): 0.28
• Shares Outstanding: 12,404,659,000
• 10 Day Avg. Volume: 105,335,686
• 30 Day Avg. Volume: 81,497,352
• PEG Ratio: 0.41
• Price to Book (P/B): 2.89
• Price to Sales (P/S): 0.25
• P/FCF Ratio: -342.09
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$13.28
• Price Target Upside: 20.68% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 82 Outperform
• Price Target: HK$13.00 ▲(18.18% Upside)

Lenovo's strong financial performance, robust technical indicators, and positive earnings call sentiment drive a high overall score. The company's strategic focus on AI and innovation, coupled with attractive valuation, further enhances its investment appeal. However, challenges in cash flow and external risks like tariff volatility are notable concerns.

Positive Factors

Earnings Growth

Earnings are expected to grow significantly, driven by the commercial PC replacement cycle and a boost in operating margins from its expanding service business.

Growth Strategy

Lenovo is leveraging the world’s largest active PC user base and its strong reputation in PCs and servers to channel growth into the services and solutions business.

Revenue Growth

Lenovo Group’s revenue for 4QFY25 arrived at US$17.0b, representing a growth of 22.8% year-over-year, which was around 8.0-9.0% higher than consensus estimates.

Negative Factors

AI Server Demand

AI server demand may soften in the near term as corporations delay purchases of high-performance servers, awaiting computing cost reductions post-DeepSeek.

Net Profit Miss

Lenovo’s 4QFY25 reported net profit missed consensus estimates at US$90m due to a US$118m loss on the ALAT warrant’s fair value change.

Tariff Uncertainties

Consumer sentiment is negatively impacted by ongoing tariff uncertainties, extending the AI-driven replacement cycle.

Lenovo Group Business Overview & Revenue Model

Company Description

Lenovo Group Limited, an investment holding company, develops, manufactures, and markets technology products and services. It operates through Intelligent Devices Group, Infrastructure Solutions Group, and Solutions and Services Group segments. The company offers commercial and consumer personal computers, as well as servers and workstations; and a family of mobile Internet devices, including tablets and smartphones. It also provides laptops, monitors, accessories, smart home and collaboration solutions, augmented and virtual reality, commercial internet of things, and smart infrastructure data center solutions. In addition, the company manufactures and distributes IT products, computers, computer hardware, and peripheral equipment; and offers IT, business planning, management, supply chain, finance, administration support, procurement agency, data management, intellectual property, and investment management services. Further, it is involved in the retail and service business for consumer electronic products and related digital services; development, ownership, licensing, and sale of communications hardware and software; and develops software and applications. Additionally, the company is involved in motherboard design and system, full-rack assembly across server, storage, and other products; and provides device-, infrastructure-, and software-as-a-service. It operates in China, the Asia Pacific, Europe, the Middle East, Africa, and the Americas. Lenovo Group Limited was founded in 1984 and is based in Quarry Bay, Hong Kong.

How the Company Makes Money

Lenovo Group generates revenue through a diverse range of business segments. The primary source of income is its Intelligent Devices Group (IDG), which includes the PC and Smart Devices (PCSD) and Mobile Business Group (MBG). The PCSD segment is the largest contributor, driven by sales of personal computers, laptops, and tablets. The MBG focuses on smartphones and other mobile technology. Additionally, Lenovo's Data Center Group (DCG) provides enterprise-level technology solutions, including servers, storage, and networking products. Lenovo also earns through its Software and Services Group (SSG), offering IT management and support services. Key partnerships with technology firms for joint ventures and strategic collaborations in research and development further bolster its revenue. Market presence in over 180 countries and a strong global supply chain also enhance Lenovo's profitability.

Lenovo Group Financial Statement Overview

Summary

Lenovo Group shows strong revenue growth and profitability improvements, with effective cost management. However, low net profit margins and negative free cash flow pose challenges in sustaining cash generation.

Income Statement

Lenovo Group has demonstrated strong revenue growth over the past year, with a notable increase from $56.86 billion to $69.08 billion, indicating a growth rate of 21.30%. The gross profit margin improved to 16.06%, showcasing efficient cost management. The net profit margin rose to 2.00% from the previous period, reflecting improved profitability. However, despite the growth, net income margins remain relatively low, which could be a concern in sustaining long-term profitability.

Balance Sheet

The company's debt-to-equity ratio stands at 0.94, suggesting a balanced capital structure with moderate leverage. Return on equity (ROE) improved to 22.81%, indicating effective utilization of shareholder funds. The equity ratio is 13.72%, showing a reasonable level of equity financing. However, the relatively low equity ratio might indicate vulnerability to financial instability in high leverage scenarios.

Cash Flow

Operating cash flow decreased significantly, resulting in a negative free cash flow of -$51.33 million, reflecting challenges in converting revenue into cash. The operating cash flow to net income ratio is 0.79, suggesting limited cash efficiency. The free cash flow to net income ratio is negative, indicating potential liquidity issues if this trend persists. Despite these challenges, financing activities increased, reflecting efforts to maintain liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	69.08B	69.08B	56.86B	61.95B	71.62B	60.74B
Gross Profit	11.10B	11.10B	9.80B	10.50B	12.05B	9.77B
EBITDA	2.98B	3.67B	3.54B	3.80B	4.29B	3.10B
Net Income	1.38B	1.38B	1.01B	1.61B	2.03B	1.21B
Balance Sheet
Total Assets	44.23B	344.13B	38.75B	38.92B	44.51B	37.99B
Cash, Cash Equivalents and Short-Term Investments	4.84B	37.48B	3.63B	4.32B	3.96B	3.13B
Total Debt	5.73B	44.60B	3.96B	4.36B	5.93B	4.42B
Total Liabilities	37.57B	291.55B	32.67B	32.87B	39.12B	34.38B
Stockholders Equity	5.52B	47.22B	5.58B	5.59B	4.99B	3.56B
Cash Flow
Free Cash Flow	433.34M	-51.33M	725.09M	1.22B	2.79B	2.81B
Operating Cash Flow	1.10B	1.10B	2.01B	2.80B	4.08B	3.65B
Investing Cash Flow	-1.06B	-1.06B	-1.28B	-1.92B	-1.50B	-975.90M
Financing Cash Flow	1.19B	1.19B	-1.34B	-413.78M	-1.76B	-3.23B

Lenovo Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0992, the sentiment is Positive. The current price of 11 is above the 20-day moving average (MA) of 10.73, above the 50-day MA of 9.86, and above the 200-day MA of 9.77, indicating a bullish trend. The MACD of 0.35 indicates Positive momentum. The RSI at 60.24 is Neutral, neither overbought nor oversold. The STOCH value of 57.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0992.

Lenovo Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0992	82 Outperform	HK$136.20B	10.51	26.62%	3.55%	21.51%	50.43%
Sector *	55 Neutral	$296.27M	4.23	-5.17%	2.67%	9.75%	-67.81%
PCPPF	―	$379.99M	9.23	10.76%	29.55%	―	―
JTI	―	€120.29M	―	-11.23%	―	―	―
6939	52 Neutral	HK$238.63M	22.77	2.61%	4.37%	-14.89%	-59.44%
2436	51 Neutral	HK$1.06B	―	-7.86%	―	29.97%	53.06%
3638	51 Neutral	HK$568.75M	15.28	-31.98%	―	-33.08%	-2532.02%

Lenovo Group Corporate Events

Lenovo Group to Review Quarterly Financial Results in Upcoming Board Meeting

Lenovo Group Limited has announced a board meeting scheduled for August 13, 2025, to review and potentially approve the unaudited financial results for the quarter ending June 30, 2025. The results are expected to be published on August 14, 2025, which could provide insights into the company’s financial health and performance, impacting investor and stakeholder perceptions.

The most recent analyst rating on (HK:0992) stock is a Buy with a HK$12.80 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Adjusts Bond Conversion and Warrant Exercise Prices Following Dividend Declaration

Lenovo Group Limited has announced an adjustment in the conversion price of its US$2 billion zero-coupon convertible bonds due 2028 and the exercise price of its warrants, following the declaration of a final dividend. The conversion price will be adjusted from HK$10.02 to HK$9.70 per share, and the exercise price of the warrants will change from HK$12.31 to HK$11.92 per share, effective August 2, 2025. These adjustments are expected to impact the company’s financial instruments and may influence shareholder decisions.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Group Approves Key Resolutions at Annual General Meeting

Lenovo Group Limited held its Annual General Meeting on July 17, 2025, where all proposed resolutions were approved by the shareholders. Key resolutions included the approval of the audited financial statements, declaration of a final dividend, re-election of directors, re-appointment of the auditor, and granting of mandates to the directors for share issuance and buybacks. Additionally, a special resolution to amend the Articles of Association was passed, reflecting the company’s commitment to aligning its corporate governance with evolving business needs.

The most recent analyst rating on (HK:0992) stock is a Buy with a HK$15.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Group Announces 2025 Annual General Meeting Agenda

Lenovo Group Limited has announced its upcoming annual general meeting (AGM) scheduled for July 17, 2025, where key agenda items include the approval of financial statements, declaration of dividends, re-election of directors, and re-appointment of auditors. The meeting will also consider resolutions to authorize the board to manage share allotments and other corporate actions, reflecting the company’s ongoing efforts to maintain robust governance and operational flexibility.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Enhances Governance Committee Structure

Lenovo Group Limited has announced amendments to the terms of reference for its Nomination and Governance Committee, which was formerly known as the Governance Committee. The changes, adopted by the Board, aim to enhance the governance structure by ensuring a majority of the committee members are independent non-executive directors, complying with the listing rules. This strategic move is expected to strengthen Lenovo’s governance framework, potentially impacting its operational transparency and accountability, thereby benefiting stakeholders.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Declares Final Cash Dividend for FY 2025

Lenovo Group Limited has announced a final cash dividend of HKD 0.305 per share for the financial year ending March 31, 2025, with payment scheduled for August 13, 2025. This announcement reflects Lenovo’s stable financial performance and commitment to returning value to its shareholders, potentially enhancing its attractiveness to investors.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Proposes Governance Amendments and Changes Share Registrar

Lenovo Group Limited has announced proposed amendments to its Articles of Association to align with updated legal and regulatory requirements, enhance flexibility in conducting general meetings, and support electronic dissemination of corporate communications. These changes, subject to shareholder approval, aim to modernize the company’s governance structure. Additionally, Lenovo will change its Hong Kong share registrar and transfer office to Tricor Investor Services Limited, effective May 30, 2025, to streamline its share registration and transfer processes.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.

Lenovo Reports Strong Annual Results with Record Revenues and Proposed Dividend

Lenovo Group Limited announced its FY2024/25 annual results, revealing a 37% increase in group profit attributable to equity holders and a 21% rise in revenue year-on-year. The company achieved record revenues across its Infrastructure Solutions Group (ISG) and Solutions & Services Group (SSG), with significant growth in R&D spending fostering innovations in AI and infrastructure. Despite a 64% drop in fourth-quarter profit due to a non-cash fair value loss on warrants, the company showed strong operational performance with a 25% increase in non-HKFRS profit. The board proposed a final dividend of HK30.5 cents per share, subject to shareholder approval.

The most recent analyst rating on (HK:0992) stock is a Hold with a HK$13.00 price target. To see the full list of analyst forecasts on Lenovo Group stock, see the HK:0992 Stock Forecast page.