＜Research＞JPM: HKT's Sale of 40% Stake in Passive Network Brightens Div. Outlook

　　A research report from JP Morgan said that HKT-SS (06823.HK) -0.020 (-0.229%) Short selling $5.51M; Ratio 7.815% announced the sale of a 40% interest in its passive network business to China Merchants Capital for US$870 million in cash. The broker deemed the deal is value accretive to HKT, and that it may help HKT de-leverage to less than 3x net debt to EBITDA in the face of a debt repayment peak in 2025-27, and boost to a 6% uplift to DPS.

　　The broker continued to favor HKT over PCCW (00008.HK) -0.020 (-0.515%) Short selling $5.10M; Ratio 31.349% on the basis of HKT's high defensiveness and its dividend yield of 9% in a stable economic outlook. It gave the former an Overweight rating with a TP of $11, and had a Neutral rating to PCCW.

　　The broker recommended investors to add to their holdings in HKT as its dividend yield spread vs US 10-year yield recently widened to 490 bps, which is 0.7 S.D. above its historical average level.

　　(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2024-06-26 16:25.)

　　AAStocks Financial News