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On Friday, JPMorgan reiterated its Overweight rating on Geely Automotive Holdings Ltd. (175:HK) (OTC: GELYF (OTC:GELYF)), with a steady price target of HK$23.00. The firm’s analyst highlighted Geely’s first-quarter earnings for 2025, which were announced on May 15, as beating expectations. The company’s strong performance is reflected in its impressive 34% year-over-year revenue growth and healthy P/E ratio of 11x. According to InvestingPro, Geely maintains robust financial health with a notably low debt-to-equity ratio of 0.08.
The analyst emphasized the positive outlook for Geely’s operational and financial performance for the remainder of the year. Notably, JPMorgan’s forecast for Geely’s 2025 volume is set at 2.8 million units, slightly above the management’s guidance of 2.7 million. Following a record level of sales in the first quarter, despite it being a low season compared to the peak in the fourth quarter of 2024, JPMorgan projects that Geely will continue to deliver record quarterly sales throughout 2025. InvestingPro data shows the company trading near its 52-week high, with multiple positive indicators suggesting strong momentum.
Financially, JPMorgan’s earnings estimate for Geely in 2025 is 12% higher than the street consensus, which has already seen a 16% increase year-to-date. The analyst also touched upon Geely’s recent move to privatize its U.S.-listed subsidiary, Zeekr. The firm is optimistic about the success of this proposal, anticipating meaningful long-term cost savings.
JPMorgan’s positive stance on Geely reflects confidence in the automaker’s ability to outperform in both sales and earnings, underpinning the Overweight rating and the December 2025 price target of HK$23.
In other recent news, Geely Auto (HK:0175) announced its intention to privatize Zeekr, a Chinese electric vehicle company, which led to a 10% increase in Zeekr’s premarket trading. The proposed deal values Zeekr at $2.566 per share, or $25.66 per American Depositary Share, reflecting a 13.6% premium over its last NYSE closing price. Geely currently holds approximately 65.7% of Zeekr’s share capital, and if the privatization proceeds, Zeekr will be delisted from the NYSE. Additionally, Jefferies raised its price target for Geely Automotive Holdings Ltd. to HK$21.80 from HK$20.00, maintaining a Buy rating. This adjustment follows Jefferies’ engagements with Geely, highlighting the company’s progress in modular car manufacturing and smart driving technology. Geely’s AI Day event in Hainan showcased its "Qianli Haohan" smart driving system and announced plans to mass-produce a Level 3 autonomous driving system. In a strategic move, Geely reduced prices on some Galaxy models and introduced new models like the E8 and Xingyao 8. Jefferies’ continued Buy rating indicates confidence in Geely’s strategic initiatives and growth potential.
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