Morgan Stanley has revised its forecasts for Angelalign (06699), raising the company’s price target by 11% to HK$105, up from HK$95, based on a discounted cash flow (DCF) valuation model. The adjustment reflects the bank’s latest guidance from management, which indicated robust sales momentum in both the Chinese and overseas markets.

According to the research report, the bank has increased its revenue estimates for Angelalign for the 2026 to 2028 period by approximately 4% each year, aligning with the company’s updated outlook. Morgan Stanley now expects the overseas business to maintain sustained profitability in terms of adjusted operating margins, although some volatility may occur in the near term.

In its updated projections, the bank has factored in higher litigation costs for 2026, as well as share-based compensation expenses stemming from a new equity incentive plan for management. Consequently, the earnings per share (EPS) forecasts for 2027 and 2028 were each adjusted upward by 6%.

Additionally, Morgan Stanley has upgraded its expectations for working capital efficiency, citing a reduction in the number of receivable days from over 200 days to approximately 190 days. This improvement is seen as a positive indicator of better cash flow management and operational efficiency.