Morgan Stanley released a research report stating that considering Wharf REIC's (00004) weak first-half performance, latest forecasts for retail and office rental rates, occupancy rates and interest rates, as well as the pre-sale and completion schedules for development properties, the firm has lowered its core profit forecasts for fiscal years 2025-27 by 13%, 7%, and 9% respectively.
However, due to the group's strong balance sheet and stable dividend policy, Morgan Stanley continues to expect the group to distribute dividends of HK$0.4 per share during 2025-27. The firm raised Wharf REIC's target price by 3% from HK$18.4 to HK$19, while maintaining its "Underweight" rating to reflect the challenging operating outlook and the group's unattractive valuation.
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