Jefferies Sees Pressure on CATL Shares After Third-Quarter Profit Miss

what happened

Jefferies analyst Kelly Zou said in a note that shares of Contemporary Amperex Technology (CATL), both A and H, could come under pressure, as the company's 2026-2028 earnings forecasts look likely to be lowered again. According to Zou, the battery maker's third-quarter results were weaker than Jefferies had expected, with net profit per unit declining from the previous quarter.

Zou noted that a 10% reduction in 2027 profit forecasts could make the stock look more expensive. In that scenario, the valuation multiple would rise from 10 to 12 for A shares and from 14 to 16 for H shares. Jefferies maintains a buy rating with a target price of 535 yuan for the A shares.

According to Market Talk, CATL's A shares closed nearly 3% lower on Tuesday at 259.08 yuan.

why it matters

The key issue for the market is not the quarterly figures themselves but the possible revaluation. If earnings fall while the share price stays put, the multiple rises, which weakens the case for further gains. For investors in Chinese battery makers, the direction of earnings forecasts matters more than any single quarter.

market impact

CATL and battery sector: cuts to profit forecasts add pressure on the share valuation

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