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Lenovo Group
(OTC:LNVGY)
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Rating:59Neutral
Price Target:
$60.00
▼(-23.05% Downside)
Action:Reiterated
Date:10/24/26
The score is held back primarily by pressured profitability and weakening free-cash-flow momentum despite improving revenue growth, plus bearish technicals (below key moving averages with negative MACD). Offsetting these, the latest earnings call signaled strong adjusted performance and AI-driven growth ambitions, but valuation remains rich relative to current margins and the dividend yield is only modest.
Positive Factors
AI growth
Rapid AI-related growth is becoming a material part of Lenovo’s business rather than a small experimental initiative. A 35% revenue contribution can support stronger infrastructure demand, broaden the portfolio, and improve the company’s strategic relevance as enterprise AI adoption expands.
Negative Factors
Thin profitability
Very low net profitability leaves Lenovo with limited protection if costs rise or demand weakens. The decline in free cash flow and weaker conversion of earnings into cash also reduce internally generated flexibility for investment, debt reduction, and sustained shareholder returns.
Read all positive and negative factors
Positive Factors
Negative Factors
AI growth
Rapid AI-related growth is becoming a material part of Lenovo’s business rather than a small experimental initiative. A 35% revenue contribution can support stronger infrastructure demand, broaden the portfolio, and improve the company’s strategic relevance as enterprise AI adoption expands.
Read all positive factors
Lenovo Group (LNVGY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$33.51B
Dividend Yield2.09%
Average Volume (3M)2.45K
Price to Earnings (P/E)39.4
Beta (1Y)0.99
Revenue Growth25.85%
EPS Growth-52.54%
CountryUS
Employees73,500
SectorTechnology
Sector Strength88
IndustryComputer Hardware
Share Statistics
EPS (TTM)1.30
Shares Outstanding641,302,250
10 Day Avg. Volume0
30 Day Avg. Volume2,448
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)1.92
Price to Sales (P/S)0.18
P/FCF Ratio5.09
Enterprise Value/Market Cap1.10
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit2.58
Enterprise Value/Ebitda9.54
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)5.82
Revenue Forecast (FY)$108.25B
Lenovo Group Business Overview & Revenue Model
Company Description
Lenovo Group Limited functions as an investment holding company, primarily involved in the engineering, production, and distribution of diverse technology products and related services. Its business is structured across three core divisions: the I...
How the Company Makes Money
Lenovo makes money primarily by selling hardware products and by providing attached services and solutions to consumer and enterprise customers.
1) Intelligent Devices Group (IDG) – device sales: A major revenue stream comes from selling PCs (inc...
Lenovo Group Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Nov 19, 2026
Earnings Call Sentiment Positive
The call presented a strong set of operational and financial highlights — record group revenue, substantial adjusted profit growth, rapid AI-related revenue expansion, and pronounced strength in ISG and SSG — demonstrating execution on the hybrid AI strategy. Key near-term risks and caveats were also disclosed: reported GAAP loss driven by large noncash items, ongoing component/memory cost pressures, and expected unit contractions in PC and smartphone markets. The company emphasized supply chain resilience, R&D investment, a large AI pipeline (not all committed), and confidence in achieving long-term revenue and margin targets.Positive Updates
Record Quarterly Revenue
Group revenue of USD 26.9 billion, up 43% year-on-year — the highest quarterly revenue in company history.
Negative Updates
Reported Net Loss Driven by Non‑Operating Items
Reported net income was a loss of USD 609 million, primarily due to a USD 1.7 billion noncash fair value loss from warrant revaluation and around USD 30 million notional interest on convertible bonds — masking the strong adjusted operating performance.
Read all updates
Q1-2027 Updates
Positive
Negative
Record Quarterly Revenue
Group revenue of USD 26.9 billion, up 43% year-on-year — the highest quarterly revenue in company history.
Read all positive updates
Company Guidance
Guidance highlighted management’s targets to reach $100 billion of annual revenue within two years (potentially sooner given Q1 momentum) and to achieve net income margin above 5%, driven by AI and broad-based group strength: AI-related revenue accelerated to over $9 billion (+60% YoY), now 35% of group revenue; Q1 results that underpin the outlook included record group revenue $26.9B (+43% YoY), adjusted operating income $1.5B (+141% YoY) and adjusted net income $1.1B (+176% YoY) with adjusted margins of 5.7% (operating) and 4.0% (net); IDG Q1 revenue $17.1B (+27% YoY), OP $1.2B, margin 7.1%, PC share 24.2% (AI PC 25.1%); ISG record revenue $8.5B (+98% YoY), OP ~$777M, margin 9.1% and an AI server pipeline of $54B (+157% q/q); SSG revenue $2.9B (+28% YoY), OP $697M, margin 24.2%, with managed services/projects 62.4% of SSG revenue and TruScale +35%; management flagged supply/memory constraints likely to persist through at least end of next year, expects second‑half unit pressure (PC units down ~15%, smartphone shipments down ~20%) but plans to offset with higher ASPs, premium mix, procurement scale and continued R&D investment (R&D +30% YoY) to sustain revenue and margin expansion.Lenovo Group Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
61
Positive
Cash Flow
58
Neutral
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 91.14B | 83.04B | 69.08B | 56.86B | 61.95B | 71.62B |
| Gross Profit | 14.32B | 12.80B | 11.10B | 9.80B | 10.50B | 12.05B |
| EBITDA | 3.88B | 4.59B | 3.67B | 3.54B | 3.80B | 4.29B |
| Net Income | 796.83M | 1.91B | 1.38B | 1.01B | 1.61B | 2.03B |
Balance Sheet | ||||||
| Total Assets | 70.11B | 57.13B | 44.23B | 38.75B | 38.92B | 44.51B |
| Cash, Cash Equivalents and Short-Term Investments | 6.12B | 4.90B | 4.76B | 3.57B | 4.32B | 3.96B |
| Total Debt | 6.67B | 5.16B | 5.73B | 3.96B | 4.36B | 5.93B |
| Total Liabilities | 61.94B | 48.55B | 37.57B | 32.67B | 32.87B | 39.12B |
| Stockholders Equity | 6.67B | 7.64B | 6.07B | 5.58B | 5.59B | 4.99B |
Cash Flow | ||||||
| Free Cash Flow | 1.98B | 2.88B | -51.33M | 725.09M | 1.22B | 2.79B |
| Operating Cash Flow | 3.27B | 4.14B | 1.10B | 2.01B | 2.80B | 4.08B |
| Investing Cash Flow | -2.39B | -1.94B | -1.06B | -1.28B | -1.92B | -1.50B |
| Financing Cash Flow | 526.68M | -2.08B | 1.19B | -1.34B | -413.78M | -1.76B |
Lenovo Group Technical Analysis
Negative
77.97
Price Trends
78.69
Negative
70.72
Negative
50.13
Positive
Market Momentum
-7.68
Positive
29.13
Positive
12.85
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LNVGY, the sentiment is Negative. The current price of 77.97 is above the 20-day moving average (MA) of 70.75, below the 50-day MA of 78.69, and above the 200-day MA of 50.13, indicating a neutral trend. The MACD of -7.68 indicates Positive momentum. The RSI at 29.13 is Positive, neither overbought nor oversold. The STOCH value of 12.85 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LNVGY.
Lenovo Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $39.12B | 27.74 | 113.67% | 1.04% | 12.15% | 24.60% | |
74 Outperform | $73.13B | 27.41 | 10.87% | 1.03% | 26.63% | 130.65% | |
73 Outperform | $269.78B | 24.25 | -574.57% | 0.57% | 48.86% | 152.40% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $33.51B | 39.36 | 11.29% | 2.09% | 25.85% | -52.54% | |
59 Neutral | $25.95B | 10.86 | -727.30% | 4.17% | 8.67% | -4.70% | |
59 Neutral | $21.65B | 9.03 | 25.08% | ― | 77.79% | 104.60% |
* Technology Sector Average
LNVGY
Lenovo Group
52.26
23.63
82.50%
HPQ
HP
28.78
2.45
9.31%
NTAP
NetApp
199.18
83.18
71.71%
SMCI
Super Micro Computer
32.95
-19.01
-36.59%
HPE
Hewlett Packard Enterprise
55.09
31.10
129.66%
DELL
Dell Technologies
424.30
263.98
164.66%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.