Jingu Finance| Huayuan Securities issued a research report, stating that the stock price of Eb Environment (00257) has fluctuated significantly recently. The bank believes that: 1) the number of projects under construction continues to decrease, and the garbage power generation industry has entered a stock operation period, and the company's operating service income will account for more than 50% in 2023. 2) Capital expenditure has decreased, and the company's free cash flow is expected to turn positive. 3) The scale of the National subsidy arrears is relatively large, if recovered in batches, the company's cash flow will further improve. 4) with the changes of domestic and foreign macroeconomic environment, the bank analysis that the market's re-pricing of risk may be the core driving force of the sector rotation in the future for a long-term asset with low covariance favored to continue.
The bank continued to point out that considering the decline in construction income, the bank lowered the company's 2024-2026 net income attributable to the parent company forecast to 4.14, 4.31, and 4.49 billion Hong Kong dollars respectively (before adjustment were 4.573, 4.715, and 4.84 billion Hong Kong dollars), and the current share price corresponds to P/E ratios of 5.3, 5.1, and 4.9 times respectively. Assuming that the dividend rate remains at 30% from 2024 to 2026, the company's dividend yield for 2024 to 2026 will be 5.7%, 5.9%, and 6.2%, maintaining a "buy" rating.