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<Research> CMBI Raises WEICHAI POWER (02338.HK) TP to HKD45.1, Says AIDC Engine Valuation Re-rating to Continue
Recommend 9 Positive 8 Negative 5 |
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CMBI issued a research report stating that WEICHAI POWER (02338.HK)'s AIDC (Artificial Intelligence Data Center) engine business has recorded strong growth, driving a re-rating of its power and energy segment. The contribution of this segment to EBITDA is expected to surge from 17% in 2026 to 38% in 2028. The report noted that in 1Q26, WEICHAI POWER's power-related engines, particularly AIDC backup power engines, recorded 2.4x YoY growth, indicating that the company is steadily capturing growth opportunities in the AIDC sector. Meanwhile, Caterpillar, Inc. (CAT.US) delivered better-than-expected results in the first quarter and raised its 2030 power equipment sales target to more than 3x the 2024 level, reflecting strong mid-term demand and high visibility for AIDC power equipment. CMBI raised its earnings forecasts for the group for 2026 to 2028 by 2%, 11% and 15%, respectively, mainly due to higher sales volume and gross margin assumptions for AIDC engines. The broker lifted its TP, based on the sum-of-the-parts valuation method, to HKD45.1 (previously HKD30.5) and reiterated its Buy rating, naming the stock as a top pick in the capital goods sector. (ad/da) Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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