[ET Net News Agency, 20 March 2020] Daiwa Research lowered its target price for China
Mobile (00941) to HK$76.6 from HK$78.7 and maintained its "buy" rating.
The research house said one of the biggest gripes of China Mobile's investors over the
years has been its dividend policy, especially its adherence to a low payout ratio formula
despite its strong balance sheet position and even during years when there was no profit
growth (eg, 2015).
Daiwa now noted that the company declared a 1% increase in DPS for 2019 although its
2019 profit fell by 9%. More importantly, China Mobile now guided for a flat DPS for 2020.
It trimmed its 2020-21 EPS forecasts by 2%-3% on lower mobile revenue forecasts, higher
EBITDA margin, and lower depreciation forecasts. (KL)