CMB International Securities analyst Walter Woo maintained a Buy rating on ANTA Sports Products today and set a price target of HK$118.55.
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Walter Woo has given his Buy rating due to a combination of factors that suggest ANTA Sports Products is well-positioned for future growth. Despite the challenges faced by the Anta brand, such as weaker-than-expected sales in certain segments and a slower ramp-up of new store formats, the company has shown resilience through strong performance in its other brands like Descente and Kolon. These brands have experienced significant retail sales growth, surpassing expectations and providing a solid foundation for the company’s overall performance.
Furthermore, Woo notes that while the Anta brand’s reform may take longer, the company’s strategic control over operating expenses, particularly in advertising and channel-related costs, supports a healthy operating profit margin. The anticipated industry turnaround and ANTA’s strategic positioning to benefit from it further bolster the Buy recommendation. The revised guidance, which includes a cut for the Anta brand but an increase for other brands, reflects a realistic and adaptable approach to market conditions, enhancing investor confidence in the company’s future prospects.
In another report released yesterday, DBS also maintained a Buy rating on the stock with a HK$118.00 price target.