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Andrew Leung: As scheduled, the Federal Reserve cut interest rates by one-fourth of a percentage point. hkbn (01310.HK) is expected to resume dividend growth.
Independent stock analyst Guo Jiayao stated that individual developments in the US stock market on Thursday (7th), as the Fed cut interest rates by a quarter point as expected, the market expects another rate cut opportunity before the end of the year. The market fluctuated and performed well, with the technology sector showing a more outstanding performance. The S&P 500 Index and the Nasdaq hit new closing highs again, while the Dow rose and fell before the close.
Broadband Firm HKBN Eyes About $800 Million Loan for Refinancing
Daiwa: Maintains hkbn 'In Sync with the Market' rating, target price raised to HK$3.8.
Morgan Stanley's research report stated that after HKBN (01310) reversed its loss and turned a profit at the end of the second half of the fiscal year ending in August 2024, maintaining stable EBITDA, free cash flow, and deleveraging should be the group's top priorities. Morgan Stanley raised the group's target price by 27%, from 3 Hong Kong dollars to 3.8 Hong Kong dollars, maintaining a rating of "in line with the market." Morgan Stanley believes that sustainability is the primary factor, requiring more patience to restore investor confidence. It is also believed that HKBN's leverage ratio below 5 times should help reduce the loan interest spread from 2.75% to 2.2%, further saving interest expenses. The bank expects progress in refinancing to continue.
UBS Group: Hong Kong Broadband Network (01310) rated as "buy", with a target price of 3.3 Hong Kong dollars.
UBS Group believes that investors have responded positively to hkbn's full-year performance, bullish on the prospect of business turning losses and stabilizing dividend payouts.
CMB International: hkbn (01310.HK) outperforms expectations in the second half of the year, benefiting from strong cost control.
Morgan Stanley's research report stated that HKBN (01310.HK) performed better than expected in the second half of the 2024 fiscal year (up to the end of August this year) in terms of EBITDA and adjusted FCF, mainly due to strong cost control and expenditure planning. The group is also deleveraging. In addition, the full-year dividend of HK$0.165 per share was a pleasant surprise. The report mentioned that HKBN indicated smooth progress in refinancing the debt due in the 2026 fiscal year, achieving strong results. Morgan Stanley believes that the results show that HKBN has emerged from the trough, but future growth in dividends per share should depend on levels of normalized capital expenditure and completion.
Hong Kong stocks surged more than 10%, turning losses into profits in the previous fiscal year.
The hkbn (1310.HK) rose by more than 10% in trading on November 1st, reaching HK$3.78, the highest since August 2023. On the news front, the group announced that the annual profit as of the end of August this year was HK$10.277 million, with an earnings per share of 0.8 HK cents and a final dividend of 16.5 HK cents; compared to a loss of HK$1.267 billion in the same period last year. In addition, hkbn announced the appointment of Leung Sing Kwong as the Chief Executive Officer of Corporate Solutions.
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