The Hong Long-listed sportswear brand Li Ning Co. Ltd. (HK:2331) has garnered multiple Buy recommendations from analysts since its Q3 operational update was released last week. In its third-quarter operational update, the company reduced its full-year guidance due to inventory concerns, causing a 20% drop in its shares in a single day. Despite this, analysts hold a bullish view of the share price, predicting a huge upside of more than 70%.
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Li Ning posted a growth of mid-single digit for its retail sales of Li Ning POS (point of sale) for the overall platform, as compared to last year. The offline channel, including retail and wholesale, registered high single-digit growth. While e-commerce was down by a single digit. During the quarter, the company added 172 POS in China, reaching a total of 6,294.
Li Ning is a leading Chinese sports brand, founded by former Olympic gymnast Li Ning. The company manufactures and sells apparel, footwear, and other sports equipment.
Latest Ratings
Following the update, the stock has received a total of seven rating conformations, of which six are Buy.
Today, analyst Melinda Hu from Bernstein confirmed her Buy rating on the stock, forecasting a growth rate of 28%. Hu believes that the Q3 update was “marred by poor communication, leaving investors dissatisfied with a troubling guide-down.”
Prior to this, last week, analyst Walter Woo from CMB International Securities and Macquarie analyst Terence Chang also reiterated their Buy ratings.
Analyst Qian Yao from J.P. Morgan has the highest price target on the stock at HK$56.40, forecasting a growth of around 125%. He also confirmed his Buy rating last week.
On the flip-side, analyst Lucy Yu of Bank of America Securities downgraded her rating from Buy to Hold on the stock. Her price target of HK$36 implies an upside potential of 43.7%.
Is Li Ning Stock a good investment?
As per the consensus rating on TipRanks, 2331 stock has received a Strong Buy rating supported by eight Buy and one Hold recommendations. The Li Ning share price forecast stands at HK$43.66, signifying a huge potential upside of 74.3% in the share price.
Year-to-date, the stock has been trading down by 63%.
