Macquarie lowered China Education Holdings' adjusted net income forecasts for the 2025 and 2026 fiscal years by 11.9% and 16.9%.
The Zhitong Finance App learned that Macquarie released a research report stating that it reaffirmed China Education Holdings (00839)'s “outperforming the market” rating, downgraded the adjusted net income forecast of 11.9% and 16.9% for the 2025 and 2026 fiscal years to reflect lower revenue and net profit forecasts, and also reduced the target price by 15%, from HK$8.7 to HK$7.4.
The total number of full-time students of China Education Holdings in the 2024 fiscal year increased 9% year on year. The growth was still stable, and led to a 17% year-on-year increase in annual revenue, which meant that revenue for the second half of the fiscal year increased 16%, which was 3% lower than the bank's forecast. The Group's net loss increased to 0.653 billion yuan in the second half of the year; adjusted net revenue rose 2%, 12% and 13% lower than the bank's and market expectations, respectively. Macquarie mentioned that China Education Holdings' dividend rate target is 40%, and the possibility of stock buybacks is not ruled out. Additionally, management expects capital expenditure over the next few years to gradually decline from FY2025.
