Morgan Stanley has issued a research note expressing a high probability, estimated above 80%, that the share price of CHINA RES MIXC (ASX: 01209) will rise over the next 30 days.
This outlook is primarily attributed to the stock's significant recent pullback, which has rendered its short-term valuation considerably more attractive.
The firm reiterates its Overweight rating on the stock, with a target price of HK$55.47.
Addressing Market Concerns
The report suggests that market concerns over a potential slowdown in the company's same-store sales growth may be excessive, largely due to weaker luxury and gold sales in recent months.
Morgan Stanley believes CHINA RES MIXC is relatively resilient, as it has significantly increased its exposure to mid- to low-end consumption and to second- and top-tier third-tier cities over the past few years.
Growth Forecasts
The firm expects the company to still achieve its guidance for high single-digit same-store sales growth, estimating a mid-single-digit figure for May, compared to the approximately 10% year-on-year growth seen in the first four months.
Furthermore, it anticipates earnings per share growth of around 11% to 14% for the year.
This projected growth is seen as driven by ongoing market share gains, the opening of new shopping malls, and margin expansion from operating leverage.
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