UBS lowers WuXi Biologics' earnings per share forecast for the next two years and slightly reduces the target price to 49.3 yuan

UBS's research report pointed out that WuXi Biologics (02269.HK) achieved performance in the second half of last year that met expectations, with revenue increasing by 17.2% year-on-year to RMB 11.8 billion (the same below), and profit attributable to shareholders rising by 38.3% year-on-year to RMB 2.6 billion. The gross profit margin improved by 5 percentage points to 46%, mainly driven by improved operational efficiency, increased licensing revenue, and higher facility utilization rates.

The report mentioned that WuXi Biologics' management expects revenue to grow by 13% to 17% year-on-year in 2026. The bank estimates that its high growth is in line with expectations, but considering potential exchange rate impacts and performance in the second half of 2025, UBS has lowered the group's earnings per share forecast for this year and next year by 4% to 5%. The target price has been slightly reduced from HKD 51.6 to HKD 49.3, corresponding to projected price-to-earnings ratios of 33 times and 27 times for this year and next year, respectively, maintaining a "Buy" rating