Goldman Sachs has reduced its target price for SUNEVISION (01686) from HK$10.9 to HK$10 while maintaining its "Buy" rating on the stock.

For the second half of fiscal year 2025, SUNEVISION reported EBITDA of HK$1.068 billion and earnings per share of HK$0.1217. The EBITDA came in 9% below Goldman Sachs' expectations, primarily due to revenue falling short of forecasts by 11%, though this was partially offset by EBITDA margin expansion of 2 percentage points. Depreciation and amortization were lower than expected, with an effective tax rate of approximately 15% compared to the firm's 16% forecast.

The company declared a final dividend of HK$0.12 per share, which was 13% below Goldman Sachs' expectations. The full-year dividend payout ratio stood at approximately 46%, lower than the firm's anticipated 50%. Management has reiterated that the dividend payout ratio ceiling will remain unchanged at 50%.

Goldman Sachs has revised down its revenue forecasts for fiscal years 2026 and 2027 by 11% and 13% respectively. Earnings per share estimates have also been reduced by 12% and 16% for the same periods. The firm expects the dividend payout ratio to remain at 46% for fiscal years 2026-28, compared to its previous expectation of 50%. Goldman Sachs projects fiscal year 2028 earnings per share and dividend per share at HK$0.37 and HK$0.17 respectively.