Benefiting from the AI PC wave, Lenovo hits a new historical high

Frequently receiving positive recommendations from institutions, Lenovo's stock price hits a historical high.

On Monday, May 27th, Lenovo Group (00992.HK) saw its stock price surge over 9% to HKD 12.06 per share, reaching a historical high.

In recent days, major institutions such as Morgan Stanley, Goldman Sachs, and CICC Citi have successively expressed optimism towards Lenovo Group, believing that the trend of AI PCs will bring significant upside potential to the company's stock price.

Lenovo may become the biggest beneficiary of AI PCs

According to Morgan Stanley, AI PC (AI Personal Computer) refers to a personal computer equipped with a Neural Processing Unit (NPU) and with a performance of at least 400 trillion operations per second (TOPS).

It is widely believed in the industry that with the continuous development of AI technology, AI PCs will inject new vitality into the PC market. In a research report released by Morgan Stanley on May 21st, it was predicted that AI PCs will become the next key factor driving growth in the PC market, with the market penetration rate of AI PCs expected to rapidly increase from 2% this year to 65% by 2028.

In the report, Morgan Stanley stated that due to Lenovo's self-developed AI chips, comprehensive AI features, and AI assistants, Lenovo will be one of the biggest beneficiaries in the AI PC market.

From a fundamental perspective, Morgan Stanley's optimism towards Lenovo is mainly based on two reasons:

1) High market share in business operations: Lenovo is the brand with the highest sales share in the $1000+ laptop market (excluding Apple), with the highest commercial risk exposure, approximately 61%;

2) Valuation at a relatively low level within the industry: Lenovo's P/E ratio for the 2026 fiscal year is around 8.8 times, with a 5-year average P/E ratio of around 8.9 times; lower than Dell's 14.8 times (2026 fiscal year), Asus's 12.2 times (2025 fiscal year), and the average level of other PC original equipment manufacturers (15-20 times).

The report predicts that Lenovo's AI PC market penetration rate will reach 64% in 2028, and the revenue contribution of AI PCs will increase from 2% in the 24 fiscal year to 53%.

The report stated that Lenovo's stock price has significant upside potential, with the company's stock rating being upgraded to "overweight" and the target price increased by a substantial 65% from HKD 9.10 to HKD 15.

During last week's conference call, Lenovo also expressed optimism about AI PCs, expecting that by 2024, approximately 20% of the PCs shipped by the company will be equipped with NPUs. By 2026, the penetration rate of AI PCs may reach 50% to 60%.

Currently, Lenovo's annual shipment volume ranges between 55 to 60 million units, with 60% of the shipment volume indicating that around 36 million units will be AI PCs.

As of today's midday close, Lenovo's Hong Kong-listed shares rose by 7.59% to HKD 11.9 per share, with a trading volume exceeding 64 million shares and a turnover exceeding HKD 7.6 billion. Year-to-date, the company's stock price has accumulated an 8.97% increase.