ZTE 0763

[winston]

not vested

We are positive on ZTE Corp as we believe the continued 4G deployment in China and the rapid expansion into the overseas market, will continue to boost its revenue.

We forecast that the carrier networks segment will remain as ZTE’s primary earnings contributor in the near term while the technological growth of 5G and Internet Plus will drive future long-term revenues.

Source: UOBKH

[winston]

not vested

Norway Sovereign Wealth Fund Kicks out ZTE from Investment Portfolio

Wall Street Journal cited Norway's Sovereign Wealth Fund that the fund eliminated ZTE (00763.HK) +0.620 (+4.133%) Short selling $19.36M; Ratio 15.950% (000063.SZ) from its investment portfolio.

Source: AAStocks Financial News

[winston]

vested

<Research Report>Citi: ZTE (00763.HK) Rated at Buy; Target Cut to $21.7

Citigroup, in its report, lifted ZTE (00763.HK)'s earnings forecast for 2015 by 9% to reflect the results of the company's guidance.

Last year, ZTE's net profit surged by 43.5% yearly to RMB3.779 billion.

Citigroup also increased the earnings forecast for 2016-17 by 2% respectively.

Yet, its target price was cut from $24 to $21.7, implying 2016E 17x P/E.

The rating was maintained at Buy.

The broker explained that the telecommunications operator will set up wireless or fixed-line broadband network to solve the data growth issue. Thus, their capital expenditure budget will increase. The company should become the major beneficiary.

Source: AAStocks Financial News

[winston]

vested

<Research Report>Citi: ZTE (00763.HK) Rated at Buy; Target Cut to $21.7

Citigroup, in its report, lifted ZTE (00763.HK)'s earnings forecast for 2015 by 9% to reflect the results of the company's guidance.

Last year, ZTE's net profit surged by 43.5% yearly to RMB3.779 billion.

Citigroup also increased the earnings forecast for 2016-17 by 2% respectively.

Yet, its target price was cut from $24 to $21.7, implying 2016E 17x P/E.

The rating was maintained at Buy.

The broker explained that the telecommunications operator will set up wireless or fixed-line broadband network to solve the data growth issue. Thus, their capital expenditure budget will increase. The company should become the major beneficiary.

Source: AAStocks Financial News

[winston]

ZTE Tumbles After Revising Down 2015 Profit On US Export Curbs

By Shuli Ren

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... ort-curbs/

[winston]

not vested

Apr 8, 2016

<Research Report>Citi Downgrades ZTE(00763.HK) to Sell with Target Cut to $11

Citi, in its report, said the net profit of ZTE (00763.HK) in 2015 was RMB3.2 billion, up 21.8% yearly and 15% lower than expected, mainly due to the US export restrictions.

2015 gross margin was flat yoy, 0.8 ppts lower than Citi estimates.

Citi expects ZTE to see slower revenue/earnings growth in the next two years due to Chinese telecoms? capex decline.

US export restrictions could add significant growth uncertainties.

The rating was downgraded to Sell from Buy and the target price was slashed to $11 from $21.7.

ZTE could see a significant negative earnings impact from the US export restrictions in the next one to two years. ZTE will likely lose some market share in certain regions, and could incur other costs before finally resolving the sanction.

Chinese telecoms? total capex will decline by 20% in FY16, and the capex trends are weaker than market expectations.

Citi expects ZTE will be aggressive in developing non-telecom and consumer businesses to diversify its revenue stream, which could lead to more margin pressure. Hence Citi cut its FY16-17E revenues slightly, but reduce its margin assumptions more significantly.

Source: AAStocks Financial News

[winston]

not vested

ZTE Tumbles: Goldman Says Sell, Sees Earnings 25% Below Street

By Shuli Ren

U.S. export restrictions or not, ZTE Corp. (763.Hong Kong) is a stock worth shorting, according to Goldman Sachs, which reinstated its coverage today with a Sell.

ZTE tumbled 6.8% to 10.92 Hong Kong dollars. Goldman’s price target of HK$10 implies another 9.2% downside.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... ow-street/

[winston]

not vested

ZTE Settles With US Over Iran Sales: Worst Is Over?

By Shuli Ren

Chinese telecom equipment maker ZTE (763.Hong Kong) soared 6% on Wednesday after ending a five-year long investigation by the U.S. government.

ZTE agreed to pay $892 million in fines and plead guilty to violating U.S. sanctions on Iran.

Without the legal overhang, ZTE’s financials look good.

In 2016, its net profit would have risen 19% to 3.83 billion yuan. In addition, ZTE said it expected to grow its net profit by between 21% and 32% in the March quarter.

Morgan Stanley, however, continues to have a Neutral rating on ZTE, saying that ZTE is not back in the up-cycle yet. China’s demand for telecom equipment is going to be muted until the country adopts 5G. Analyst Yunchen Tsai wrote:

Looking into 2017, operators should continue to reduce capex for both wireless and optics in China. ZTE is still losing share in handsets in China and overseas.

The share price could be volatile in the near term, in our view, as we see the latest announcement as a mixed bag as market looks forward, but fundamentals probably will not pick up until the 5G cycle comes.

ZTE’s shares have fallen 11.3% over the last year.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... t-is-over/

[winston]

not vested

March 29, 2017

<Research Report>M Stanley Downgrades ZTE (00763.HK) to Underweight; Focuses on Capex Cut for CN Telecoms

Morgan Stanley, in its report, said the recent share price rally of ZTE (00763.HK) should be reflecting the settlement with the US Department of Justice and bullish market sentiment about 5G opportunities in China.

However, the broker is also aware of Chinese telecoms slashing capex this year.

CHINA MOBILE (00941.HK) reiterated that 5G commercialization will start in 2020, so the broker expected the share price of ZTE to lack support, hence downgrading it from Equalweight to Underweight with target price kept at $12, equivalent to 11x 2017 P/E (estimate).

Source: AAStocks Financial News

[winston]

not vested

ZTE: Green Shoots after U.S. Export Ban; Stock Could Have 33% Upside

By Isabella Zhong

ZTE (763.HK) has won its first international contract after the U.S. lifted its export ban on the controversial Chinese telecom equipment maker in March.

It inked a deal with Digicel to expand its 4G LTE network in 26 markets across the Carribean and Central America.

Digicel, a new customer, is the first international mobile contract awarded to ZTE after its US export ban was lifted. We also believe ZTE displaced the original vendor Ericsson.

Digicel is a major mobile operator in 36 markets across the Caribbean and Central America with roughly 15m subscribers.

ZTE indicated the contact was not very big, but we believe the significance is that Digicel is a new customer, and ZTE very likely displaced, at least partly, the original vendor Ericsson.

We pointed out that Huawei’s market leadership status will likely prompt it to be more profitability focused, and both Ericsson and Nokia would avoid competing purely on price.

ZTE also won an exclusive contract to build a private network and passenger information system for a new metro train project in Dalian. While the CNY200 million to CNY400 million contract may not be very big in size,

Lee argues it shows that ZTE has the capabilities to benefit from China’s expanding rail network.

Lee has a buy rating on ZTE with an HKD18.8 a share target price, which implies 33% upside.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... 33-upside/