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SJM Holdings Limited Just Missed Earnings - But Analysts Have Updated Their Models
Analysts Offer Insights on Consumer Cyclical Companies: Sea (SE), SJM Holdings (OtherSJMHF) and Brilliance China Automotive Holdings (OtherBCAUF)
Goldman Sachs: Maintains Buy rating for SJM HOLDINGS and lowers the Target Price to 3.2 Hong Kong dollars.
Goldman Sachs released a Research Report stating that it maintains a "Buy" rating for SJM HOLDINGS (00880), with the Target Price adjusted from HKD 3.4 to HKD 3.2. The firm adjusted the group's EBITDA for 2025 to 2026 to a negative 2%. SJM HOLDINGS' fourth-quarter performance generally met market expectations, with EBITDA decreasing by 4% quarter-on-quarter to HKD 0.993 billion, mainly due to a decline in the VIP room win rate to 3.9%. After adjustments, and considering the high employee costs at the Satellite casinos, EBITDA is expected to remain flat quarter-on-quarter at HKD 1.1 billion, or about 90% of pre-pandemic levels. The firm stated that management remains optimistic about the outlook.
Citigroup: Maintains SJM HOLDINGS 'Sell' rating, Target Price 2.05 HKD.
Citi released a Research Report stating that it maintains a "Sell" rating on SJM HOLDINGS (00880), with a Target Price of HKD 2.05. The bank noted that the market share of SJM's "Grand Lisboa" project has continued to improve in the last quarter, but the rate of improvement is slowing. Additionally, SJM's debt ratio has significantly improved, but it remains at a high level, making it unlikely to resume dividend payments in the short term, coupled with uncertainties regarding the Satellite venues managed by the group. Citi mentioned that SJM's net income grew by 19% year-on-year last quarter; adjusted EBITDA improved by 42% to HKD 0.993 billion, roughly in line with the bank's forecast of HKD 0.996 billion and exceeding market expectations.
Citigroup: Maintains SJM HOLDINGS (00880) "Sell" rating with a Target Price of 2.05 HKD.
Management guidance indicates that the gambling revenue for the first two months of this year recorded double-digit growth year-on-year, while expenditures for the 2025 fiscal year are expected to range between 1.5 billion and 2 billion Hong Kong dollars, maintaining an optimistic outlook on the potential impact of changes to the Satellite business model.
SJM Holdings Returns to Profit in 2024 as Net Revenue Surges 33%
