by winston » Fri Jun 26, 2009 10:20 am
Not vested. Not sure about this one. The Sports Apparel market is saturated but the Olympic deal may bring them some visibility..
DJ MARKET TALK: Citi Starts Anta Sports At Buy, Target HK$12.30
0847 [Dow Jones] STOCK CALL: Citigroup starts Anta Sports (2020.HK) at Buy, with target price at HK$12.30, based on 20X 2010 PER. "We like Anta for its brand strength, sound financial position, and undemanding valuations." Says despite stock +149% year-to-date, valuation still looks undemanding at 16X 2010 PER; estimates stock would trade at 12.6X 2010 PER excluding net-cash of more than CNY3.4 billion.
Forecasts 2009-11 earnings CAGR of 22%, mainly on 26% revenue CAGR. Believes stock's historical average PER discount of 33% to Li Ning (2331.HK) should continue to narrow, given Anta's better earnings growth and balance sheet.
Adds, despite most sportswear brand companies', distributors' caution on near-term outlook, views sector's 2010 outlook as favorable as inventory levels normalize, pricing environment improves. Shares ended yesterday +2.8% at HK$9.65.
It's all about "how much you made when you were right" & "how little you lost when you were wrong"