[ET Net News Agency, 14 August 2019] J.P. Morgan lowered its target price for WH Group
(WHG)(00288) to HK$8.5 from HK$9.9 and maintained its "overweight" rating.
The research house said WHG's 1H sales/earnings were down 0.4%/16.9%, 7% behind market
expectations. China margin eroded on historical high pork price (a result of an ongoing
outbreak of African Swine Fever, while US margin contracted due to oversupply and trade
dispute with China and Mexico.
Though China's inventory was up 77% YoY/70% HoH in 1H (helping margin in 2H), JPM
doesn't expect a meaningful fundamental turnaround in 2H. However, it noted that valuation
looks attractive. Taking out its China operation (trading at 13.5x 2020 P/E), WHG's
current market cap implies its US operation trades at 9x P/E and 1x P/B.
JPM said any positive development on US/China tariff negotiation, rising imports from
other countries, and favorable FX would be key catalysts. (KL)
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00288 WH GROUP
Nominal 
5.800 -0.030 (-0.515%) Others
14/08/2019 17:37
{I-bank focus}JP Morgan lowers WH Group (00288) to HK$8.5
| Remark: | Real time quote last updated: 25/04/2024 16:18 |
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