Nomura raised Lenovo Group's target price to HK$35 in one go, reiterating its buy rating.

Nomura Securities released a report maintaining a buy rating on Lenovo Group, based on a forecast of 20 times earnings per share for the 2027 fiscal year. The target price was significantly raised from 16 Hong Kong dollars to 35 Hong Kong dollars, indicating a 46% upside potential. In Nomura's previous Lenovo report released in May, the bank had emphasized that the momentum of the general server business could exceed expectations. Despite Lenovo's stock price rising over 100% since May, Nomura believes that this outperformance may continue because the bank believes that the market has not fully reflected the potential of Lenovo's server business. Nomura's profit forecast for the 2027/28 fiscal year is now about 10% higher than market consensus. Lenovo is currently in the process of reappraisal, with its main competitor Dell trading at a 30 times one-year forward price-to-earnings ratio. Nomura believes this creates room for Lenovo's reappraisal. The bank has raised its profit forecast for Lenovo Group for the 2027/28 fiscal year by 12%.