Jinwu Financial News | Longhu Group (00960) continued to rise. As of press release, it reported HK$10.82, up 6.29%, with a turnover of HK$210 million.
According to the news, Lyon issued a report stating that Longhu Group's basic profit fell 50% year-on-year last year, which is at the lower end of the financial security range. However, its operating and service revenue continues to rise and accounts for about 60% of profits. Growing recurring profits can provide financing support and better profit visibility. The bank lowered Longhu's profit forecast for this year by 23% and 21.6%, respectively, to reflect lower profit margins on property sales, but raised the target multiples because of higher profit quality and a healthier portfolio. Accordingly, the target price was raised from HK$11.4 to HK$12, and the “buy” rating was maintained.
According to a report published by Morgan Stanley, Longhu Group's performance last year was generally in line with expectations. According to the bank, the Group's saleable resources reached RMB 240 billion this year, 55% of which are concentrated in first-tier and second-tier cities. To maintain the same level of contract sales throughout the year, the elimination rate needs to increase from 56% last year to more than 70%. It believes that real estate sales will still face challenges this year. Damo slightly lowered its earnings forecast per share for 2024 to 2025, but raised the target price from HK$9.8 to HK$11.2 based on performance performance expectations, strong core profit, and financial ability to beat expectations, maintaining an “gain” rating.