The Goldman Sachs research report released on January 7 stated that it maintained a neutral rating on Chow Sang Sang (01929.HK) with a target price of HK$8. The company's guidance for the 2025 fiscal year and the second half of the fiscal year remains unchanged. The same-store sales growth (SSSG) in December this quarter is generally the same as the guidance, with a double-digit decline in mainland China and a high double-digit to low 20% decline in Hong Kong and Macau. The report quoted management as saying that there is sufficient cash flow to support dividend payments, and the free cash flow for the second half of the 2025 fiscal year is HK$10 billion, which is enough to support capital expenditures and a dividend payout ratio of 70-80%. Management is also cautious about the company's performance during the Lunar New Year, and underperforming stores will continue to close in 2026. If the sentiment remains weak, management believes that 6,000-6,500 stores can continue. The company also has brand upgrades and has added new concept stores in mainland China. The company also plans to open 20-30 new Chow Sang Sang Heritage stores in mainland China.
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Goldman Sachs: Maintains a 'Neutral' rating for Chow Tai Fook with a target price of HK$8
The Goldman Sachs research report released on January 7 stated that it maintained a neutral rating on Chow Sang Sang (01929.HK) with a target price of HK$8. The company's guidance for the 2025 fiscal year and the second half of the fiscal year remains unchanged. The same-store sales growth (SSSG) in December this quarter is generally the same as the guidance, with a double-digit decline in mainland China and a high double-digit to low 20% decline in Hong Kong and Macau. The report quoted management as saying that there is sufficient cash flow to support dividend payments, and the free cash flow for the second half of the 2025 fiscal year is HK$10 billion, which is enough to support capital expenditures and a dividend payout ratio of 70-80%. Management is also cautious about the company's performance during the Lunar New Year, and underperforming stores will continue to close in 2026. If the sentiment remains weak, management believes that 6,000-6,500 stores can continue. The company also has brand upgrades and has added new concept stores in mainland China. The company also plans to open 20-30 new Chow Sang Sang Heritage stores in mainland China.