Key Takeaways:
- Morgan Stanley upgraded Yangtze Optical Fibre to overweight from market perform
- The firm maintained its HKD 230 price target on the Hong Kong-listed shares
- An AI-driven fiber optic supercycle supports the earnings growth trajectory
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Morgan Stanley upgrades Yangtze Optical Fibre to overweight, target HKD 230
Morgan Stanley upgraded Yangtze Optical Fibre and Cable (06869.HK) to overweight from market perform, citing a 50% decline that created an attractive entry point.
An AI-driven fiber optic supercycle supports the company's unchanged earnings growth trajectory, Morgan Stanley said in a July 15 report. The stock has fallen about 50% from its June 2026 high.
The firm maintained its price target at HKD 230. The previous rating was market perform. Morgan Stanley did not disclose the previous target price or the name of the analyst who authored the report.
The upgrade from a bulge-bracket firm could attract institutional buying interest in the Hong Kong-listed shares. Yangtze Optical Fibre is a leading producer of optical fiber and cable, positioning it to benefit from rising demand for high-bandwidth connectivity in AI data centers.
The upgrade signals that Morgan Stanley views the recent selloff as overdone relative to the structural demand from AI infrastructure. Investors will watch for the company's next earnings report for updated guidance on fiber optic cable orders.
This article is for informational purposes only and does not constitute investment advice.
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