Long underrated, at least in my view, for its potential to gain share in more lucrative PC categories and drive more operating leverage, Lenovo (OTCPK:LNVGY) has been getting its due lately with the pandemic driving exceptional PC volume growth around the world. While strength in the PC business is certainly carrying the business, I believe there has also been more progress in the server business than may be generally appreciated.
With the shares up over 100% since my last write-up, the valuation and investment thesis have changed pretty significantly. Now risks of a post-pandemic PC slowdown loom larger and a lot more is riding on the company’s growth strategy in servers and data center customers. Taking that all into consideration, these shares have a lot less appeal as a value name and I’m at least considering selling into this strength.
Read more here:
Lenovo Thumps Sell-Side Expectations With Robust Volumes And Operating Leverage
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