ALI HEALTH's stock plummeted 5.10% during intraday trading on Thursday, reflecting significant selling pressure.
The decline followed a report from Goldman Sachs which lowered its target price for ALI HEALTH from HK$5.20 to HK$4.80 while maintaining a "Neutral" rating. The adjustment reflects the bank's concerns that increased investments in artificial intelligence (AI) and pharmaceutical categories will negatively impact the company's profitability in the near term.
Goldman Sachs anticipates a slight profit contraction in the second half of the year, reversing the profit expansion seen in the first half. This outlook is primarily attributed to higher spending on AI initiatives and increased discounts on proprietary drugs offered in response to competitive pressures within the market.
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