Morgan Stanley released a research report stating that after weigao group (01066) announced its interim performance, it continues to forecast the company's annual sales growth rate for the next three years to be 4%.
This is slightly conservative compared to the company's sales growth guidance of 5% to 10% in 2024. At the same time, the earnings per share forecast for 2024 is raised by 1.2%, while the earnings per share forecast for 2025 and 2026 are reduced by 0.9% and 3% respectively, resulting in a 3% compound annual profit growth rate for the next 3 years. Taking into account the uncertain regulatory background, the weighted average cost of capital assumption is raised from 10.5% to 11%. The target price is lowered from 5.5 Hong Kong dollars to 5.1 Hong Kong dollars, with a rating of 'in line with the broader market'.
