JPMorgan maintains BYD stock Overweight with HK$600 target

On Tuesday, JPMorgan reiterated its Overweight rating and HK$600.00 price target for BYD Co Ltd (OTC:BYDDY) (1211:HK) (OTC: BYDDF (OTC:BYDDF)), which currently commands a market capitalization of $155.41 billion. The firm’s analyst highlighted BYD (SZ:002594)’s fourth-quarter earnings for 2024, which surpassed expectations by 5%, propelled by strong sales volume and an improved product mix. The results indicated that BYD is on track to achieve record earnings and sales volumes in 2025 and 2026, building on its impressive 17.91% revenue growth over the last twelve months.

The analyst forecasted BYD’s ascent as a dominant player in the global New Energy Vehicle (NEV) market, likening the company’s potential growth trajectory to that of Toyota (NYSE:TM). This outlook is supported by BYD’s remarkable performance, with the stock delivering a 100.57% return over the past year and trading near its 52-week high of $54.60. JPMorgan’s long-term projection sees BYD reaching approximately 10 million units in global shipments by 2030. Current consensus estimates for BYD’s 2025 earnings have increased from Rmb49 billion to Rmb52 billion over the past month, which is still below JPMorgan’s estimate of Rmb55 billion—a figure the firm considers potentially conservative.

The company is expected to host an analyst briefing today, where management will likely address several key topics. These include BYD’s competitive profitability, strategies for global market expansion amidst geopolitical challenges, advancements in AI and autonomous driving technology, and the rollout of new models featuring the company’s latest super-fast charging technology. InvestingPro analysis shows BYD maintains a GREAT financial health score of 3.44, with 13 additional exclusive insights available to subscribers.

JPMorgan’s outlook for BYD remains positive, with the firm emphasizing the company’s solid performance and strategic initiatives that could further strengthen its position in the NEV market. Trading at a P/E ratio of 31.93, BYD currently appears slightly undervalued according to InvestingPro Fair Value analysis. The analyst briefing is anticipated to provide additional insights into BYD’s future plans and ongoing projects.

In other recent news, BYD has announced plans to select a location for its third European plant within the next seven to eight months, following the inauguration of its first European facility in Hungary. The company also showcased a new battery technology that reportedly allows its electric vehicles to charge almost as quickly as refueling a traditional car. Meanwhile, BYD plans to hire an additional 20,000 employees at its Zhengzhou facility in the first quarter of the year to support increased production capacity. Global sales of fully electric and plug-in hybrid vehicles reached over 17 million in 2024, with significant growth driven by the Chinese market and new emission targets in Europe, according to research firm Rho Motion. However, Brazilian labor authorities are investigating allegations of human trafficking and forced labor at a BYD factory construction site in Bahia State. This investigation involves claims of overcrowded living conditions for workers, leading to temporary housing arrangements in hotels. The Chinese foreign ministry has communicated with Brazilian authorities to verify the situation, emphasizing compliance with labor laws. BYD’s planned factory in Brazil, with an investment of $620 million, is expected to have an annual capacity of 150,000 cars.

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