CITIC Securities released a research report noting that for FY3Q26, TOPSPORTS (06110) reported a high-single-digit year-on-year decline in sales value (corresponding to a 2-year/3-year CAGR of -6%/-1%). While the all-channel discount rate for the quarter slightly deepened year-on-year, the rate of decline narrowed compared to the previous quarter, and inventory levels and age structure continued to improve. The company has revised its full-year guidance downward, indicating pressure to achieve the original target of flat year-on-year net profit, with a possibility of a slight deviation. In the short term, the industry faces challenges with weak customer traffic, putting pressure on all-channel discounts and overall sales. From a medium- to long-term perspective, as industry inventory health improves, sales momentum recovers for key brands like Nike, and performance scales up for new exclusive distribution brands in running and outdoor categories such as SOAR, Norrøna, and Norda, the company is expected to gradually return to a stable growth trajectory. Furthermore, considering the company's history of high dividend payouts and high dividend yield, the report values the company at 15X PE for fiscal year 2027, corresponding to a target price of HK$3.5, and maintains an "Overweight" rating.