Goldman Sachs: Shengyao Biotech (02269) raised earnings estimates for the first half of the year to 2026 to 2028

The Zhitong Finance App learned that Goldman Sachs released a research report saying that Yao Ming Biotech (02269)'s revenue and adjusted net profit for the first half of the year both beat expectations. Taking into account stronger growth in outstanding orders and improved operating leverage, the bank raised its 2026-2028 earnings per share forecast by 11.3%, 11% and 12.7%, respectively. The company's revenue for the period was about 3% higher than the bank's expectations, mainly due to strong demand for pre-clinical projects and accelerated business growth in China. Adjusted gross margin expanded to 48.4% from 45.6% in the same period last year, benefiting from increased capacity utilization, manufacturing scale efficiency, continuous efficiency improvements, and increased contributions from high-margin complex projects, which were partially offset by foreign exchange headwinds. Gross margin expansion is structural and sustainable, not driven by one-off factors.

The bank pointed out that the total number of unfinished orders in hand rose 24% year over year to US$25.1 billion, of which uncompleted service orders were US$12.6 billion and potential milestone costs were US$12.4 billion. Unfinished orders over a three-year period rose by about 30% year over year to US$5.5 billion, enhancing the visibility of growth in 2027. 169 new comprehensive projects were added during the period, of which about two-thirds came from the US and Europe. More than 70% of the newly signed projects were bis/multispecific antibodies and ADCs, supporting the continuous upgrading of the project portfolio. Management expects more than 300 new integrated projects to be added every year by 2027, supported by global demand and capacity expansion.