On Friday, Citi adjusted its outlook on WHA Corp (WHA:TB) shares, a leading Thai logistics and industrial estate firm, by reducing its price target from THB6.20 to THB5.90. Despite this change, the firm maintained its Buy rating on the company’s stock.
The price target adjustment followed a 5.6% decline in WHA Corp’s share price after WHART’s unitholders rejected a proposed investment in new assets the previous day. The failed approval has a negative impact on WHA’s profit and loss statement due to the delay in its asset divestment plan to a Real Estate Investment Trust (REIT).
In response to this development, Citi revised its earnings projections for WHA Corp, decreasing its 2024 and 2025 earnings estimates by 11% and 2%, respectively. The new target price is based on a lower earnings per share (EPS) forecast for 2024 and 2025, while the target price-to-earnings (P/E) ratio remains unchanged at 17 times.
Citi’s outlook for WHA Corp is still positive, with the expectation of earnings growth of 8% this year and 16% the next. The firm’s current trading at 14.7 times its 12-month forward P/E ratio, which is considered reasonable given the anticipated bottom-line growth from a strong 2023 base. The investment firm’s stance is that the negative news has been factored into the current share price, suggesting that the stock’s valuation is not demanding.
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