Lenovo Group Ltd
00992: XHKG (HKG)
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| HKD 93.00 | Rqt | Ccxslywb |
PC Shipment Recovery and Improving Product Mix Led by AI PCs to Offset Sluggish Server Demand
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Business Strategy and Outlook
Lenovo’s acquisition of IBM’s ThinkPad PC business in 2005 has helped propel the company to be a leader in the PC market with 24% global market share. The successful integration of the ThinkPad business has also enabled Lenovo to increase its commercial-related sales, which currently make up 60% of its PC sales, as well as stabilize its PC margins in recent years. We expect PC sales to continue to make up around 70% of overall sales, while the segment’s profit margins should remain stable, given less intense competition at the higher end of the PC market.