Bank of America Securities estimates that the annual compound growth rate of earnings per share of Kingsoft (03888) from 2023 to 2026 can reach more than 50%.
According to the report from Bank of America Securities, due to the strong growth of Kingsoft (03888) gaming business, the profit forecast for 2024 to 2026 has been raised by 2% to 10%, and the target price has been adjusted from HKD 29 to HKD 31. The "buy" rating has been reiterated, and it is estimated that the annual compound growth rate of earnings per share from 2023 to 2026 can reach more than 50%.
The report states that Kingsoft's second-quarter revenue increased by 13%, exceeding market and Bank of America's forecast by 1% and 5% respectively. During the period, profit increased nearly six times to RMB 2.47 billion, significantly surpassing market and Bank of America's expectations by about 40% and 28% respectively. This is believed to be driven by the rapid growth of the gaming business and the narrowing of losses in affiliated companies.
