Upgrades and downgrades
BUY
Wheelock & Co
Daiwa Institute of Research has upgraded Wheelock from '4', or underperform, to '2', meaning outperform. Wheelock, which owns Wheelock Properties and 48 per cent of Wharf (Holdings), has underpeformed the market by 11.7 per cent over the past month, Daiwa said. But investors should consider whether the company may be the next privatisation target after Kerry Properties, the house said. The importance of keeping Wheelock listed had decreased as it had been streamlining assets in recent years and was mainly a passive holding company for Wharf. Daiwa has a price target of HK$6.20.
BUY
Huaneng Power
Core Pacific-Yamaichi has reiterated its 'buy' call based on higher earnings expectations for this year and next. The brokerage raised its power generation forecast by 3 per cent for this year and 2.6 per cent for next year after Huaneng recorded a 42.86 per cent year-on-year rise in power generation for the first quarter. Core Pacific has a price target of HK$7.90, based on a multiple of 11 times forward earnings.
SELL
Topsearch International
DBS Vickers has lowered its rating to 'sell' from 'fully valued', saying there would be further downside in the counter as the global printed circuit board sector continues to be de-rated. The brokerage expects earnings to fall 95.8 per cent this year to HK$2 million. DBS also warned that long-term investment value would remain poor until corporate transparency improved. The brokerage cut its price target from 75 HK cents to 65 HK cents.
