Daily Stock Analysis: Lenovo Group (LNVGY)

Lenovo Group LTD, known by the ticker symbol LNVGY, is a large Hong Kong computer hardware maker and operates in the Technology business sector. This is my first report on LNVGY for my Viital stock portfolio, I selected it as a replacement for my 46th pick in my sixth Vista portfolio in August. 

Lenovo, as a global technology hardware company, has a leading market share in personal computers.

Person Holding Black Iphone 7

Image Source: Pexels

Its operations are divided into three main business segments: (1) PC and smart devices, (2) mobile, and (3) data center, which account for 80%, 9%, and 10% of sales, respectively. 

The firm has been actively growing its data center business, which primarily sells network servers to enterprise and hyperscale customers, as well as storage equipment through its mainland China joint venture with NetApp. 

Server-related revenue contribution has jumped to 10% of overall sales in fiscal 2020 from 6% in 2015.

The company operates in China, the Asia Pacific, Europe, the Middle East, Africa, and the Americas. 

Lenovo Group Limited was founded in 1984 and is based in Quarry Bay, Hong Kong.

Three key data points gauge any dividend equity or fund such as Lenovo Group LTD (LNVGY):

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.

LNVGY Price

Lenovo's price per share was $23.26 as of yesterday's market close. One year ago its price was $18.69. Therefore, LNVGY's share price rose $4.57 or nearly 24.5% in the past year.

If LNVGY's stock trades in the range of $18.00 to $28.00 this next year, its recent $23.26 share price might rise by $2.24 to reach $25.50 by January 4, 2023. My estimate is four cents over the average annual share price increase by Lenovo or the past five years.

LNVGY Dividends

Lenovo's most recent semi-annual dividend of  $0.205 was paid on December 17th, to shareholders of record on November 24th. That semiannual dividend, added to the previous payout equals $0.83 annually and yields 3.55% per yesterday's $23.36 closing price. 

Lenovo Group LTD (LNVGY) has paid variable semi-annual dividends since September 18, 2006. That will come to  16 years in September.

LNVGY Returns

Adding the $0.83 annual estimated LNVGY forward-looking dividend to my $2.24 price upside estimate shows a $3.07 potential gross gain, per share, to be reduced by any costs to trade LNVGY shares.  

At yesterday's $23.26 price per share, a little over $1000 would buy 43 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at sale and might cost us about $0.23 per share.

Subtract that maybe $0.23 brokerage cost from my estimated $3.07 gross gain per share results in a net gain of $2.84 X 43 shares = $122.12 for a 12.2% net gain on a $1,000.18 investment.

So it is that Lenovo Group LTD (LNVGY) shows a possible 12.2% net gain including a 3.55% forward estimated dividend yield. 

Over the next year at this time, a $1000 investment in Lenovo Group LTD (LNVGY) could generate $35.50 in cash dividends alone. Note that a single share of LNVGY stock bought at yesterday's closing price was $23.26. Therefore, Lenovo's share price is just bout one and one-half times less than the dividend income from $1000.00 invested. So, by my dogcatcher ideal, now is a prime time to pick up Lenovo Group LTD  shares. The estimated next-year dividend from $1K invested is 1.526 times LNVGY's single share price. Consider yourself alerted. It's a sign!  

All of the estimates above are speculation based on the past history of Lenovo Group LTD  (LNVGY). Only time and money invested in this stock will determine its market value.

Disclaimer:   This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...

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