Shares of BYD Co. are trading higher after the Chinese vehicle maker posted better-than-expected third-quarter earnings on strong demand for new-energy vehicles.
The Hong-Kong listed shares of the automaker were up 7.2% at 177.60 Hong Kong dollars (US$14.98) in early trading Monday, trimming its year-to-date loss to 33%. Shares are outperforming a 0.4% gain for the city’s benchmark Hang Seng Index.
BYD said late Friday that revenue more than doubled to CNY117.08 billion (US$16.14 billion) in the third quarter, while net profit more than quadrupled to CNY5.72 billion.
Bocom International analyst Angus Chan maintained a buy rating on the stock and raised his earnings forecasts by 75% for this year and by 80% for next year “to reflect strong gross profit margin outlook on model mix upgrade.”
Still, he cut its target price to HK$354.96 from HK$382.11, citing a weakened yuan and weak stock market sentiment.
As the Chinese company grows its foothold globally, Jefferies’ analysts said in a note that they believe “the margin for BYD’s overseas sales could be much higher than domestic sales given the price premium,” and raised its sales volume forecast to 1.9 million vehicles this year and 2.7 million in 2023 to factor its strong sales and export potential.
Shares of BYD Electronic (International) Co., a subsidiary, are also trading higher after it reported a 7.9% rise in its January-September turnover, coming after revenue in the first half fell compared with the year earlier period. Net profit also improved, falling 42% on year in the first nine months of the year after a 61% on year drop in the first half.
Shares of BYD Electronic were last up 14% at HK$22.90.