Key Takeaways:
BofA Securities has reiterated its "Buy" rating on Li Ning Co. (02331.HK), signaling confidence that the sportswear maker's earnings have bottomed and are poised for a rebound. The bank maintained its price target of HKD25 for the Hong Kong-listed shares.
The reaffirmation comes after Li Ning reported mid-single-digit growth in retail sales for the first quarter of 2026. According to the BofA report, this performance keeps the company on track to achieve its full-year target of high-single-digit revenue growth.
BofA's positive outlook contrasts with the stock's recent performance. Shares of Li Ning fell 3.8 percent on the day of the report, which also noted significant short-selling activity amounting to a ratio of 37.2 percent. The bank's thesis rests on the expectation that earnings, which have been stable or declining since 2022, will return to a high-single-digit growth trajectory in 2026.
The reiterated Buy rating suggests BofA sees the current share price as an attractive entry point ahead of the anticipated earnings recovery. Investors will be closely watching for the company's full-year results to see if the growth rebound materializes as the bank predicts.
This article is for informational purposes only and does not constitute investment advice.
