Morgan Stanley released a research report saying that it is expected that the stock price of PCCW (00008) will fall within 15 days. The probability of this happening is expected to exceed 80%. The rating is “in sync with the market”, and the target price is HK$4. The company's total dividend for the full year of last year increased 1% year over year to 38.25 cents.
According to the report, the dividend transmission rate of the subsidiary HKT-SS (06823), which holds 52% of the shares in the previous two years, fell to 97% last year, which was unexpected for the market and had a negative impact. Under pressure from free cash flow, the risk of a decline in dividend conductivity is expected to continue. As HKT's dividend payouts are more visible, it is expected that the market will prefer HKT over D&G, further dampening its short-term investment sentiment.