Investment outlooks for 2026 and A-share company target prices from foreign institutions including JPMorgan, Morgan Stanley, and UBS

Will Semiconductor recently launched its new OV50R CMOS image sensor, featuring a 1/1.3-inch optical format, 50-megapixel resolution, and 1.2μm pixel size—positioned for premium main-camera applications in smartphones, action cameras, vlog cameras, and portable cameras. The OV50R has completed sampling and is scheduled to enter mass production in Q1 2026, potentially enhancing the company’s penetration into the high-end imaging market. JPMorgan forecasts net profit growth of 33.82% for 2025 and 40.05% for 2026. UBS: Global tech stocks poised for a new rally in 2026! UBS upgrades four companies to “Buy”! In its 2026 investment outlook, UBS states that the A-share market stands at a positive inflection point marked by improving earnings growth and valuation re-rating. A-share earnings growth is expected to accelerate from 6% this year to 8% next year. This acceleration stems from two key drivers: first, faster nominal GDP growth and a narrowing year-on-year decline in the Producer Price Index (PPI) are expected to jointly boost listed companies’ revenues; second, the implementation of supportive macro policies and sustained healthy deleveraging across the corporate sector may drive a modest recovery in overall profitability. Moreover, the current A-share equity risk premium—above its historical average—suggests significant potential for valuation re-rating. Additionally, the recent market correction largely reflects adjustments across the global tech sector and short-term trading congestion, thereby presenting an opportune moment to position for medium-term re-rating logic. UBS’s Global Strategy Team believes global tech stocks will enter a new upswing in 2026. Investment themes recommended include technological self-reliance, consumption recovery, sectors benefiting from “anti-overcompetition” (e.g., photovoltaics, lithium batteries, chemicals), and Chinese enterprises expanding overseas. Key risks to monitor include escalation of U.S.-China trade tensions, continued real estate sector weakness, and a potential global AI bubble burst. According to our analysis, since October this year, UBS has issued updated ratings on 196 A-share companies: maintaining “Buy” ratings on 131, upgrading four to “Buy”, and one to “Neutral”. UBS also initiated coverage on 15 companies, assigning “Buy” ratings to Great Wall Motor, EdiGene Biotechnologies, and Longhua Technology. Regarding target price upside, UBS’s latest target price for Aipu Medical is RMB 118 per share—compared to its closing price of RMB 61.28 on December 5—implying over 90% upside potential. Morgan Stanley, Goldman Sachs, and Citigroup: A-share valuations remain attractive! Stock selection is critical! Wang Ying, Chief China Equity Strategist at Morgan Stanley, notes that in 2025, China’s equity market completed a decisive valuation recovery (MSCI China Index P/E ratio rebounded from 9x to over 13x), driven by consumption-supportive policies, “anti-overcompetition” measures bolstering confidence, growing international recognition of Chinese enterprises’ global competitiveness, and marginal improvement in the geopolitical environment. Looking ahead to 2026, further substantial expansion of overall market valuations appears limited, with index gains likely in the low single digits. The primary driver of returns will shift toward mid-single-digit corporate earnings growth. Investment focus must transition from “valuation expansion” to “earnings-driven returns”, seeking alpha through selective stock picking and thematic exposure.

[A Decade in the Making] UBS’s latest research report decoded: Can towering champions emerge from the hyper-competitive automotive sector?

On November 5, Seres Group officially listed on the Hong Kong Main Board, becoming China’s first luxury new-energy vehicle (NEV) manufacturer to achieve dual listing on both A- and H-share markets. Despite being hailed as “the largest automaker IPO on the Hong Kong market since 2022”, Seres experienced an opening-day share price decline below its offering price. Its IPO price was HK$131.5, but it opened at HK$128.9 and dipped as low as HK$118 intraday—down over 10% from the offer price. The stock subsequently remained weak: as of November 7, Seres’s H-share price had fallen 13.23% below its IPO price. Over these two days, multiple international institutions—including Citigroup and UBS—issued views on Seres. On November 7, UBS released a report downgrading Seres from “Buy” to “Neutral” and lowering its target price from RMB 170 to RMB 150. Let’s examine what UBS highlighted: 1. UBS’s concerns: 30–40% downward revision to earnings forecasts; surging expenditures squeezing profits UBS cut its net profit forecasts for Seres for 2025–2027 by 30–40%, revising them to RMB 8.2 billion, RMB 11.7 billion, and RMB 15.2 billion, respectively. These revised forecasts imply annual net profit growth rates of 37%, 43%, and 30% over the three years—roughly 0–16% below consensus estimates. UBS acknowledges Seres’s leading position in China’s mid-to-high-end automotive market, yet now estimates its net profit margin at only 5–6%, down from its prior forecast of 8–10%, reflecting the company’s ongoing heavy investment phase. UBS points to rapidly rising sales, marketing, and R&D expenses as the primary reason behind the downward revision to net profit margin forecasts. Shoufengren Commentary: After reading this report, even novices should grasp that achieving high-profit growth for Seres over the next two or three years is nearly impossible. Short-term traders betting on Seres will be deeply disappointed: Seres is building for a future three to five years out—not for today or tomorrow. Following this downgrade, short-term speculators will inevitably part ways with Seres. 2. The awkwardness of the H-share listing: deep discount issuance and collective foreign investor skepticism and selling Seres’s H-share IPO presented a stark contrast: on one hand, investor enthusiasm during the subscription phase was intense—the Hong Kong public offering portion was oversubscribed 133 times, attracting over 200,000 applications and freezing over HK$170 billion in funds. On the other hand, after listing, foreign investors collectively expressed bearish sentiment and sold off shares—essentially casting a vote of no confidence in Seres’s Huawei collaboration assets. Trading data shows net selling by foreign investment banks including Morgan Stanley, UBS, and Goldman Sachs. Citigroup assigned a “Neutral” rating to Seres’s H-shares and downgraded its A-share rating from “Neutral” to “Sell”. Shoufengren Commentary: Foreign investors exhibit strong caution toward China’s NEV industry. Recently, Hong Kong-listed auto stocks have broadly underperformed. BYD’s share price fell from a peak of HK$157 to below HK$100, while Li Auto dropped from HK$128 to around HK$78—a roughly 40% decline for both. Seres’s current forward P/E ratio on the Hong Kong market stands at just 25x—comparable to industry leader BYD. At this valuation level, Seres is neither overvalued nor undervalued. However, the broader auto sector still faces near-term pressure to reverse its downturn.

UBS cuts target for Braskem stock to USD 1.50

Oct 20, 2026

UBS downgraded Braskem stock to 'Sell' with a target price of USD 1.50, citing high corporate debt and leverage ratios. Investors await the November 12 earnings report for updated financial visibility.

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