Global cross-asset and equity research roundup Report Interpretation

Overview

This is a global research roundup spanning China AI models, equity strategy, sector previews, company results, insurance, Japan macro, commodities and US/EU Conviction Lists. Its central market view is that leadership is broadening beyond a narrow technology trade, while several industry and company updates identify specific earnings, pricing and supply-demand catalysts.

Core views

On China Internet and AI models, Goldman Sachs raises its estimate for aggregate Chinese AI-model annual recurring revenue at end-2026 to US$13bn from US$10bn, citing higher demand and faster commercial ramp-ups. It increases 2026E revenue estimates by 35% for Z.AI and 63% for MiniMax. The report nevertheless keeps Z.AI at Neutral and MiniMax at Buy, while lowering their 12-month target prices to HK$1,610 and HK$800, respectively. The reasoning is that competition for the most attractive performance-to-price combination is intensifying; MiniMax’s H3 open-weight offering is priced at roughly one-third of peers. Goldman Sachs continues to prefer Cloud & Data Centers as token demand proliferates. For global equities, the report characterizes current market behavior as a healthy normalization: returns are broadening across regions and sectors because of strong earnings growth rather than multiple expansion. Hyperscaler capital expenditure has reduced technology free-cash-flow yields and caused a sector de-rating, but the same capex cycle is improving growth prospects and valuations for old-economy industries such as Industrials. With lower stock correlations and a momentum unwind shifting market leadership, Goldman Sachs argues that stock selection and finding value within growth areas should become more important. In China technology, the report downgrades SICC to Neutral from Buy and cuts its 12-month target price to Rmb104 from Rmb115. Although it remains positive on the company's 12-inch SiC substrate launch and the application potential in AI advanced packaging and AR devices, it considers the benefits of R&D strength and capacity expansion largely priced in. Goldman Sachs lowers 2026-28E net-income estimates by 6-8% because it assumes lower revenue and gross margin amid price declines for 6-inch and 8-inch SiC substrates. Separately, it expects Kinsus to benefit from a possible ABF-substrate shortage in 2027-28 as next-generation AI products require larger packages and more layers. It forecasts approximately 8% quarter-on-quarter ABF and BT substrate price increases in both 3Q26 and 4Q26, raises 2027-29E earnings estimates by 5-10%, lowers 2026E earnings by 5%, and raises the 12-month target price to NT$1,125. For China games, Goldman Sachs sees defensive characteristics ahead of the 2Q26 results season as sector multiples trade near five-year lows and the market narrative shifts from AI disruption toward AI beneficiaries. It reports 12% year-on-year online-gaming growth in 1H26, supported by new-content supply and upgrades to evergreen titles. It highlights Buy-rated NetEase and Tencent for game resilience, Bilibili for advertising and profit growth, and Tencent Music Entertainment for favorable risk-reward. For China mobility technology, Goldman Sachs expects 2Q26 results to show divergent volume and average-selling-price trends, producing mixed margins and profits across covered NEV OEMs. Leapmotor and Nio are expected to post the strongest volume growth, at 57% and 49% year-on-year, while BYD and XPeng are expected to be broadly flat and Li Auto down 11%. BYD and Nio are estimated to achieve 12% and 23% year-on-year ASP gains through premium models and overseas contribution, whereas Li Auto's ASP is projected to decline 8% on product mix. The report expects EBIT-margin improvement for BYD, Leapmotor and Nio, but declines for XPeng because of higher R&D and for Li Auto because of lower volume. It models net-profit growth of 34%, 41% and 102% for BYD, Leapmotor and Nio, respectively, and declines of 137% and 213% for XPeng and Li Auto. Goldman Sachs names BYD, Leapmotor, NIO and XPeng as Buys. Company updates are broadly constructive but differentiated. WuXi AppTec's 2Q26 revenue and non-IFRS earnings grew 47.7% and 91.7% year-on-year and exceeded Goldman Sachs estimates; management lifted FY26 continuing-operations revenue-growth guidance to 35-39%, supported by backlog growth and order momentum in small molecules, TIDES and Testing. Goldman Sachs therefore raises FY26-28E non-IFRS earnings estimates by 13.9%, 13.0% and 12.9% and increases 12-month target prices to HK$192.70 and Rmb172.40. MUFG reported ¥809.4bn of first-quarter net income, up 48% year-on-year, driven by 11% loan growth excluding government lending, wider domestic corporate lending spreads and market-related revenue. While market-related revenue may ease from the second quarter, Goldman Sachs views core revenues as sustainable, raises FY3/27-FY3/29 net-income forecasts by up to 1%, and increases its target price to ¥4,000 from ¥3,900. In consumer, energy and solar, Eastroc Beverage remains Buy despite a lower Rmb155.40 target price: severe weather slowed energy-drink and Bushuila demand sequentially, so sales estimates for 2026-28 are cut 2-6% and 2027-28 net-profit forecasts 3-5%, but confidence in second-half margins is supported by first-half marketing and refrigerator investment and a minimum 80% dividend-payout commitment. Luckin Coffee's 2Q25 revenue and non-GAAP net profit rose 29% and 22% year-on-year to Rmb15,886mn and Rmb1,753mn, 3% and 19% above Goldman Sachs estimates; a 21.3% self-operated-store operating margin and declining delivery-expense ratio support higher 2026-28 profit forecasts and a US$51 target price. For S-Oil, Goldman Sachs raises 2026 EBITDA estimates 31% and expects 62% quarter-on-quarter operating-profit growth in 3Q as crude premiums ease and middle-distillate cracks rise. Limited capacity additions, roughly 6.5mb/d of outages in Russia and the Middle East, and a potential early-2027 Shaheen-project free-cash-flow inflection underpin its constructive refining view. Xinyi Solar's 1H26 profit met guidance; the report raises 2026E EBITDA by 57% on anticipated higher shipments and lower costs as domestic supply discipline and overseas recovery improve the outlook. In China insurance, Goldman Sachs expects strong 1H26 profit growth from second-quarter equity investment gains but believes this is mostly priced in. It expects slower new-business-value growth because of bancassurance disruption and a higher comparison base, and changes sector target prices by -3% to +11% to reflect investment-market moves and lower bond yields. It prefers property and casualty insurers to life insurers. The report expects intelligent-vehicle penetration to reduce claims frequency and produce an underwriting-margin inflection over the next 12 months; leaders are expected to retain part of the resulting safety benefit, improving combined ratios. It upgrades PICC Group H to Buy with a HK$7 target price, reiterates Buy on PICC P&C with a HK$20.2 target price, and maintains Sell on PICC Group A with a Rmb6.4 target price. On macro and global lists, Goldman Sachs views the first coordinated US-Japan foreign-exchange intervention in 15 years as a strong signal against further yen depreciation. Planned use of the Federal Reserve's FIMA Repo Facility would enable Japanese authorities to borrow US dollars for intervention without selling US Treasuries, reducing potential US-market stress and giving the Bank of Japan greater policy flexibility. The report still expects gradual BOJ rate hikes at roughly six-month intervals, with the next in January. In US Conviction List changes, Applied Materials, Delta Air Lines, Microsoft, O'Reilly Automotive, Viking Holdings and UPS are added; Goldman Sachs cites, respectively, share-gain potential in DRAM and foundries, airline pricing power, enterprise AI adoption, DIFM-market share gains, differentiated cruise exposure, and a revenue-and-profit inflection. ASML, Sika and Puig are added to the European Conviction List; for ASML, Goldman Sachs expects capacity visibility and margins reaching 50% by 2029, with FY27-29 EPS estimates 5-18% above consensus. For commodities, the report argues that China policy can dampen hydrocarbon and gold-price volatility through price-sensitive imports and sovereign purchases, but can amplify critical-metal volatility when supply-chain dominance is used as leverage. It points to lower Chinese LNG and crude net imports as stabilizing markets amid reduced Middle East supply, while export restrictions have caused ex-China critical-metal shortages and sharply higher prices.

Analysis framework

The report combines bottom-up earnings, volume, pricing, margin and target-price revisions with sector supply-demand analysis and top-down market strategy. It compares operating trends against estimates or consensus, links industry conditions to earnings and valuation implications, and uses policy and market-structure developments to frame macro, currency and commodity views.

Methodology notes

• Industry AnalysisSupply-demand framework

  Supply-demand analysis

  The report uses capacity additions, outages, product demand and supply discipline to explain refining margins, substrate pricing, solar economics and critical-metal price behavior.

• Industry AnalysisVolume-price decomposition

  Volume, ASP and margin decomposition

  For NEV manufacturers, Goldman Sachs separates expected volume growth, average-selling-price changes, EBIT margins and net-profit outcomes to explain divergent results.

• Valuation methodsP/E and PEG Valuation

  Valuation-multiple analysis

  The report discusses sector de-rating, five-year-low gaming multiples and valuation being priced in, using earnings and valuation changes to frame expected upside.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Z.AI

  China AI-model developer benefiting from higher demand but facing intensifying performance-to-price competition

  Strengths

  2026E revenue estimate raised 35%.

  Weaknesses

  Neutral rating and lower HK$1,610 target price.

  Comparison

  MiniMax's H3 open-weight model is priced at roughly one-third of peers.

  Risks

  Competition may constrain valuation and upside.

• MiniMax

  China AI-model developer highlighted for performance-to-price positioning

  Strengths

  2026E revenue estimate raised 63%; Buy rating retained.

  Weaknesses

  12-month target price lowered to HK$800.

  Comparison

  H3 open-weight pricing is roughly one-third of peers.

  Risks

  Intensifying AI-model competition.

• SICC

  SiC substrate company downgraded as valuation reflects expansion positives

  Strengths

  12-inch launch and AI advanced-packaging and AR applications remain positive.

  Weaknesses

  2026-28E net-income estimates cut 6-8%.

  Comparison

  6-inch and 8-inch substrate prices are declining.

  Risks

  Lower revenue and gross-margin assumptions.

• WuXi AppTec

  CDMO company with raised guidance and earnings estimates

  Strengths

  2Q26 revenue and non-IFRS earnings grew 47.7% and 91.7% year-on-year; strong backlog and orders.

  Comparison

  Results significantly exceeded Goldman Sachs expectations.

• PICC Group H

  China P&C insurance beneficiary of improving underwriting margins

  Strengths

  Upgraded to Buy with a HK$7 12-month target price.

  Weaknesses

  Sector profit growth is considered largely priced in.

  Comparison

  Goldman Sachs prefers P&C insurers over life insurers.

  Risks

  Slower new-business-value growth from bancassurance disruption and base effects.

• ASML (ASML)

  European Conviction List addition

  Strengths

  Capacity-addition visibility and potential margin expansion to 50% by 2029.

  Comparison

  FY27-29 EPS estimates are 5-18% above consensus.

• Viking Holdings (VIK)

  US Conviction List addition

  Strengths

  Differentiated geographic exposure and higher-income customer demographic.

  Comparison

  These attributes are expected to offset a choppier cruise environment.

  Risks

  Choppy cruise environment.

Key data

• China AI-model ARR estimateUS$13bn by end-2026Raised from US$10bn on higher demand and faster ramp-ups.
• China online gaming growth12% year-on-yearReported for 1H26.
• WuXi AppTec FY26 revenue-growth guidance35-39% year-on-yearFor continuing operations; raised by management.
• MUFG 1Q net income¥809.4bnUp 48% year-on-year.
• S-Oil 3Q operating-profit outlook+62% quarter-on-quarterExpected as crude premiums ease and middle-distillate cracks rise.
• Global refining capacity outagesApproximately 6.5mb/dAcross Russia and the Middle East.
• ASML margin outlook50% by 2029Goldman Sachs expects capacity visibility to support margin progression.

Impact & implications

Goldman Sachs frames the environment as one in which broadening earnings leadership and lower correlations reward selective security selection rather than a uniform sector call. Its preferred exposures are tied to AI-token demand, selected gaming and mobility names, improving P&C underwriting, refining tightness, technology supply-chain pricing, and identified Conviction List additions.

Risks

• AI-model competition may intensify as providers compete on performance-to-price.
• SiC substrate price declines could pressure SICC revenue and gross margins.
• China insurance new-business-value growth may slow because of bancassurance disruption and a higher base effect.
• Market-related revenue tailwinds for MUFG may ease after the second quarter.
• Severe weather, higher expenses and PET-cost pressure could affect Eastroc Beverage.

What to watch

• China AI-model demand, commercial ramp-ups and performance-to-price competition.
• Breadth of global earnings growth, technology free-cash-flow yields and leadership rotation.
• 2Q26 NEV volume, ASP, margin and profit outcomes across covered OEMs.
• WuXi AppTec backlog and order momentum in small molecules, TIDES and Testing.
• Claims-frequency trends and combined-ratio improvement in China P&C insurance.
• The timing of BOJ rate hikes and the effect of coordinated FX intervention on the yen.
• Refining cracks, capacity outages and the Shaheen project's expected early-2027 free-cash-flow inflection.