Goldman Sachs: downgraded China Merchants Property (02669.HK) rating to "Sell" and lowered target price to HK$5

Wisdom Financial APP learned that Goldman Sachs issued a research report stating that China Overseas Property (02669.HK) outperforms its peers due to its more stable business prospects and solid support from its state-owned parent company China Overseas Land & Investment (00688.HK). However, the report believes that the company's underperformance relative to the broader market is due to the continued headwinds in the real estate market, which continue to drag down the business outlook and valuation of the property management industry. Furthermore, China Overseas Property's own profit and profit growth have slowed, coupled with low visibility on shareholder returns growth. The bank has lowered its average net profit forecast for the group from 2025 to 2027 by 11% to reflect an average revenue forecast decline of 13%. It is expected that the annual compound growth rate of revenue from 2025 to 2027 will be 5%, and the average free cash flow and operating cash flow forecasts for 2025 to 2027 will be reduced by 16% and 13% respectively. The target price has been lowered from HK$6.1 to HK$5, and the rating has been downgraded from "buy" to "sell".