UBS initiates Ningbo Sanxing Medical Electric with buy rating

Published 27/06/2025, 07:32
UBS initiates Ningbo Sanxing Medical Electric with buy rating

Investing.com - UBS initiated coverage on Ningbo Sanxing Medical (TASE:BLWV) Electric (SSE (LON:SSE):601567) stock with a buy rating and set a price target of RMB30.00.

The Chinese power equipment manufacturer has seen its shares decline 25% year-to-date, primarily due to weak domestic smart meter demand indicated by recent tenders in China, according to UBS.

Despite current market challenges, UBS projects a new replacement cycle could drive a recovery in smart meter demand beginning in 2026. The firm also notes that strong distribution transformer orders from overseas markets should make the company’s business less cyclical.

UBS forecasts Ningbo Sanxing’s earnings per share growth will accelerate to a 27% compound annual growth rate during 2025-2027, up from 16% growth expected in 2025. The company currently trades at 9 times its projected 2026 price-to-earnings ratio, below its historical average of 13.4 times.

The investment bank also highlights Ningbo Sanxing’s anticipated 5-6% dividend yield for 2025-2026, supported by its net cash position and stable payout ratio of approximately 55%.

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