Morgan Stanley lowered its price target for VNET Group Inc. to $14.00 from $16.00. The firm maintained its Overweight rating on the Chinese data center and cloud services provider. This 13% reduction follows a revision of the company's net debt forecasts.
Analysts raised adjusted EBITDA estimates for the years 2026 through 2028. Effective operational expense controls drove this improved earnings outlook. Despite the lower target, the $14.00 valuation remains significantly higher than the stock's recent trading price.
A substantial debt burden continues to pressure the company's valuation. VNET shares recently fell following a wider-than-expected second-quarter earnings miss. Market uncertainty also persists regarding a pending transaction with CATL.