Morgan Stanley released a research report stating that it has lowered the Target Price for TRAVELSKY TECH (00696) by 7.4% from 9.5 HKD to 8.8 HKD, with the most optimistic (bullish) Target Price reduced by 9% from 14.5 HKD to 13.2 HKD; the most pessimistic (bearish) Target Price lowered by 10.4% from 4.8 HKD to 4.3 HKD, and the investment rating is 'in line with the market.'
Morgan Stanley indicated that it has lowered the profit forecasts for TRAVELSKY TECH for 2024, 2025, and 2026 by 11.8%, 13.5%, and 10.7% respectively, mainly due to foreign Airlines and higher costs adapting to system revenue growth, which has resulted in service income growth being below expectations.
The report states that, assuming the weighted average cost of capital (WACC) and probability weights remain unchanged, the bank has reduced its scenario values for TRAVELSKY TECH's most bullish/base/bearish cases by 9%/7%/10% respectively. The bank also moved the valuation of TRAVELSKY TECH from mid-2025 forward to the end of 2025.
