Bank of America Securities: Maintains Neutral Rating on AAC TECH (02018) and Raises Target Price to 45.4 Hong Kong Dollars

Bank of America Securities released a research report stating that it maintains a "neutral" rating on AAC TECH (02018), with the target price raised from HK$38 to HK$45.4. The bank has increased its profit forecasts for AAC TECH for the years 2024 to 2026 by 5 to 17% to reflect an improvement in demand for smartphones. The bank mentioned that it has identified several new growth drivers in the acoustic/mechanical to optical fields this year. However, these business segments are still relatively small, and due to competition and AAC TECH's past fluctuations in sales and profits, caution is advised regarding sustainability after this year. The current valuation is equivalent to a forward price-to-earnings ratio of 22 times for this year and next, which is in line with historical average levels and peer averages, indicating a reasonable valuation.