MTRC 0066

Re: MTRC 0066

Postby winston » Sun Aug 15, 2010 8:43 am

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DJ MARKET TALK: MTRC +0.7%; Strong Results As Catalyst - CS

1054 [Dow Jones] MTR Corp. (0066.HK) +0.7% at HK$28.40, outperforming vs HSI's 0.1% fall, supported by stronger-than-expected 1H results; company reports 1H net profit +48% on-year at HK$6.64 billion, which equivalent to around 86% of FY10 net profit forecast based on Thomson Reuters.

"We believe this set of numbers should be a catalyst for the stock," says Credit Suisse. Says MTRC's 1H underlying net profit at HK$5.7 billion was 10% higher vs house's estimate.

Notes that MTRC has underperformed both property and utilities sectors in HK since May 2010. Keeps at Outperform, HK$33.10 target based on sum-of-the-parts valuation.


Source: Dow Jones Newswire
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Re: MTRC 0066

Postby winston » Thu Sep 30, 2010 9:48 am

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DJ MARKET TALK: MTRC Potential Beneficiary Of HK Inflation - CS

0926 [Dow Jones] STOCK CALL: Credit Suisse keeps MTRC (0066.HK) at Outperform with HK$33.10 target; highlights MTRC as potential beneficiary should inflation in HK continue to pick up.

Says in inflationary environment, MTRC benefits in all 3 of main businesses:
1) Property investment,
2) Property development,
3) Rail operations (via annual fare adjustment mechanism).

"In our view, MTRC remains a uniquely positioned stock in Hong Kong, at the intersection of utilities and property." MTRC ends yesterday +0.3% at HK$29.00.


Source: Dow Jones Newswire
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Re: MTRC 0066

Postby winston » Wed Nov 10, 2010 3:28 pm

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DJ MARKET TALK: Goldman Upgrades MTR Corp To Buy; HK$35.60 Target
Oct 12, 2010

1243 [Dow Jones] STOCK CALL: Goldman Sachs upgrades MTR Corp (0066.HK) to Buy from Neutral, raises target to HK$35.60 from HK$30.30 after revising up FY10, FY11, FY12 earnings estimates by 4%-22% to reflect higher-than-expected patronage growth year to date, latest property price assumptions.

Says potential catalysts for stock include Tai Wai Station, Nam Cheong Station site tenders. Reckons increase in land supply by HK government would affect company's bargaining power against developers in future site tendering; "but after underperforming its peers by 15% year to date, the stock appears to have priced in little expectation for its upcoming site tenders."


Source: Dow Jones Newswire
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Re: MTRC 0066

Postby winston » Thu Feb 10, 2011 9:56 am

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DJ MARKET TALK:MTR Corp Good Hedge Against Inflation -DBS Vickers

0939 [Dow Jones] STOCK CALL: DBS Vickers tips MTR Corp (0066.HK) "a good hedge against inflation," and keeps the stock at Buy with a HK$36.85 target.

The house says MTRC's railway and related earnings are improving, with the expected slight improvement in margins, EBITDA from HK railway and related businesses is estimated to be 10% higher in FY10.

DBS adds, a far hike is "on the horizon" due to rising inflation, which will add further momentum to MTRC's recurrent earnings.

On valuations, DBS says the stock is trading 22% below its assessed current NAV, which is "attractive given its resilient income base and promising long-term growth prospects led by significant network expansion."

The stock is bid down 1.1% at HK$28.20 at pre-open.

Source: Dow Jones Newswire
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Re: MTRC 0066

Postby winston » Tue Sep 20, 2011 10:48 am

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DJ MARKET TALK: MTR Corp Down 1.8%; Strong Prospects In China - BNPP

1025 [Dow Jones] MTR Corp (0066.HK) is down 1.8% at HK$25.05; BNP Paribas keeps a Buy rating on the stock with a HK$37.40 target, as it believes the Hong Kong rail operator is well-positioned to win railway-plus-property bids in China, following the successful bid for a property development project at the Shenzhen Metro Line 4 depot.

The house expects MTRC will be able to successfully replicate its rail-plus-property model in China.

"We believe MTRC will continue to have strong prospects in China development, while its growing yield nature should find favor with the market in the current volatile environment."

Source: Dow Jones Newswire
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Re: MTRC 0066

Postby winston » Wed Feb 22, 2012 3:10 pm

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DJ MARKET TALK: MTRC Shares Likely Rangebound, Neutral - JPM

1434 [Dow Jones] STOCK CALL: JPMorgan slightly raises MTRC's (0066.HK) target price to HK$24.90 from HK$23.20 on higher NAV estimate, but keeps the stock at Neutral.

It says MTRC's railway and rentals remain solid, but property development offers limited upside, given an unexciting project completion pipeline (only three over the next three years) and unfavorable environment for tenders (MTR has been slowing down its tender schedule or else faces the possibility of poor response).

JPM adds, going into 2H12, a review of its fare adjustment mechanism might also create uncertainty over future fare-setting with a potentially less favorable formula to MTRC.

"MTR share price is likely to be range-bound in our view, despite JPM turning more constructive on Hong Kong property recently," the house says and prefers Hutchison (0013.HK) or Hong Kong developers for more attractive risk-reward.

MTRC is up 0.2% at HK$27.05.

Source: Dow Jones newswire
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Re: MTRC 0066

Postby winston » Fri Aug 05, 2016 1:14 pm

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<Research Report>BofAML Lifts MTR CORPORATION Target to $41; Predicts Interim Core Earnings to Fall 35%

After considering yield compression and higher preference for defensive investments after Brexit, Bank of America Merrill Lynch, in its report, lifted the NAV of MTR CORPORATION (00066.HK) by 8%, with target price lifted from $35 to $41 with rating Neutral.

The broker expected the 1H16 core net profit to fall 35% yearly due to less development projects, and lowered the 2016-18 EPS forecast by 3%-15% on lower rental and ad revenue forecast.

MTR will soon start talks with the government on Fare Adjustment Mechanism (FAM), with a conclusion expected near year-end.

Bank of America Merrill Lynch believed that there would be no major negative outcome, as any material change would require minority shareholders' approval.

Yet, the broker cannot rule out that the chance that minor change may be introduced such that MTR's margins may be affected The broker expected household income could potentially be a new factor in FAM, dropped significantly in past recessions.

As such, MTR's fare change may be capped in recessions in such case.

Source: AAStocks Financial News
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Re: MTRC 0066

Postby winston » Mon May 29, 2017 1:00 pm

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Why Now Is a Good time to Buy Hong Kong MTR’s Stock
By Daniel Shane

Broker Daiwa just upgraded its price target on the Hong Kong rail operator and property developer to HKD47.8 from HKD43.15, saying the shares should rebound from increased competition for land in the Asian financial hub.

Daiwa analyst Jonas Kan rates MTR Corp Outperform, and now sees more than 10% upside in this stock.

Kan thinks MTR Corp could pick up steam based on its huge land bank of nearly 2 million square feet, which is among the biggest in Hong Kong. Prices in the city continue to soar amid the recent emergence of mainland Chinese companies as major property players, which has ratcheted up competition.

Here’s more:

Moreover, MTRC does not have to tie up tens of billions of capital to buy such landbank and can structure the bidding terms in such a way that it can lock in sizeable property sales profits now, irrespective of how residential prices might change in the next few years.

Most importantly, the entry of more Chinese competitors to Hong Kong’s residential property sector should only enhance MTRC’s position in the industry, in our view.

But Kan also thinks investors are gradually coming to view MTR Corp as a global player, given the company now operates metro networks as far afield as London. He explains more:

While MTRC has not had this image in the past, we see a solid fundamental case for it to be seen as such over time, which would only be helped by its growing presence overseas (UK, Sweden, Australia) and in China. In any case, we believe the 13 projects MTRC has awarded and 4 mall projects in its pipeline will help underpin sustained growth in property sales profit and rental income from 2018.

Source: Barron's Asia

http://www.barrons.com/articles/why-now ... 1496026171
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Re: MTRC 0066

Postby winston » Fri Mar 06, 2020 7:20 am

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Unrest dents MTR Corp earnings, income slumps to HK$11.9b

MTR Corp, which took a battering from protesters and police raids into rail stations from June last year, reported today net profit for 2019 dropped by 25.5 percent to HK$11.93 billion, or earnings per share after revaluation of HK$1.94.

The profit includes the gain arising from investment property revaluation.

Group revenue in 2019 was HK$54.50 billion, up by 1.1 percent from the year before, mainly due to the full year contribution from the high speed railway and higher revenue contributions from mainland of China and international subsidiaries.

This was offset mostly by the reduction in Hong Kong fare revenue and rental concessions to some tenants in station kiosks and shopping malls because of the unrest.

At the tail end of 2019, the MTR Corp suffered further blows from the coronavirus that spread from Wuhan in China to Hong Kong, forcing restrictions on rail operations.

In January and February in 2020, rail and bus passengers in Hong Kong skidded by 34 percent compared with same period in 2019.

The mass transit rail operator declared a final dividend of HK$0.98 per share. The full-year dividend is HK$1.23 percent, up by 2.5 percent increase from a year ago.

Rail operations, station commercial and property rental businesses, took a hit from the social unrest.

Passengers on week days fell to 5.61 million, a drop of 4.5 percent from 2018.

In the first half, total patronage gained by 2.5 percent, but fell by 14.8 percent in the second half. Expenditures for hiring additional staff during the period and carrying out extensive repairs and replacements also had an adverse effect on financial and operational results.

The station commercial and property rental businesses was affected as a result of early closures during protests.

The MTRC estimated the financial impact of the coronavirus outbreak and the unrest in the first two months of 2020 at about HK$1.3 billion on the net profit of the recurrent businesses. The estimate is not audited.

Revenue from Hong Kong transport operations increased by 2.3 percent to HK$19.94 billion, helped by the high-speed rail, which launched in September 2018. But total patronage of rail and bus passenger services dropped by 6.4 percent to 1.91 billion, with a 14.8 percent decline in the second half amid protests.

The MTRC also made a provision of HK$2 billion last year for the Hung Hom incidents of the Sha Tin to Central Link project, and a HK$436 million of provision related to the South Western Railway in the United Kingdom.

The MTRC generated HK$5.14 billion from property rental businesses last year, up by 1.6 percent year-on-year.

Property development profit reached HK$5.5 billion mainly derived from Malibu, or Lohas Park Phase 5 and The Lohas shopping mall atop Lohas Park phase seven. The company awarded two new property packages in 2019 and one in 2020.

The company plans to tender out three property development packages, including its last package at Lohas Park and the fifth and sixth packages at Wong Chuk Hang Station. The projects are expected to provide about 4,050 residential units.

Source: The Standard

https://www.thestandard.com.hk/breaking ... o-HK$11.9b
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Re: MTRC 0066

Postby winston » Wed Jan 04, 2023 4:17 pm

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MTR CORP (66 HK)

Recommendation : BUY
Fair Value : HKD 52.0

STEADY OUTLOOK.
Steady recovery in patronage
Property development profit is expected to be insignificant in 2H22
Station commercial have showed signs of improvement

Steady recovery in patronage. We expect patronage of MTR Lines to recover to around 98% of the 2018 level, implying close to 20% year-on-year (YoY) in 2023.

Going into 2023, there is a potential fare hike in mid-2023, as consumer price index (CPI) & wage index are likely to return to positive territory.

While share price has rebounded by about 15% in 4Q22, it underperformed Hang Seng Index marginally, driven by market concerns over subdued housing demand & potentially higher risk associated with the Oyster Bay (Siu Ho Wan) project as the company invests directly to acquire the site.

We view MTRC as being a beneficiary to a recovery of local consumption & a pick-up in inflationary pressure with a possible fare hike to be implemented in June 2023.

Near-term market concerns would include potential traffic & tenant sales dilution given more HK residents will travel abroad during the holiday season in the next few months.

MTRC’s net asset value (NAV) is estimated based on the following:
i) we value MTRC's railway business using discounted cash flow (DCF), based on a weighted average cost of capital (WACC) of around 6% & a terminal growth rate of 2.5%;
ii) we value its various new lines in HK & China using DCF;
iii) we value its property development business using DCF & its investment property business is using rental capitalisation;
iv) we value its rail-related businesses based on a 20x P/E multiple.

Our Fair Value estimate of HKD52 is set at a 10% discount to the estimated NAV, which is at historical average.

Source: OCBC
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