BUY PCCW Closing price: $5.35 Target price: $6.50 Share price performance (%) 1wk: 0.94 3mths:3.6 1mth:3.88 1yr:2.88 The rating on PCCW has been upgraded to 'buy' on hopes of solid earnings this year. 'Following some recent meetings with PCCW, we are convinced that the outlook on local telephony is improving,' analysts Danny Chu and Dylan Tinker said in a report. The analysts also expected PCCW to declare a dividend this year given its improved cash flow. 'We believe PCCW could easily support a 4 to 5 per cent dividend yield this year,' they said. UBS HOLD Denway Motors Closing price: $3.225 Target price: $3.40 Share price performance (%) 1wk: 7.19 3mths:34.19 1mth:21.11 1yr:113.4 The fair valuation of Denway shares after a recent correction has led analyst Jerry Lou to upgrade his recommendation on the mainland carmaker from 'underweight'. 'The stock now trades at a price-earning ratio of 10 times this year, exactly in line with our valuation,' Mr Lou said in a report. He projected price cuts of 5 per cent for the Accord model and 8 per cent for the Odyssey and Fit next year. 'The speed of industry deflation is becoming so fast that no player can escape it,' Mr Lou said. Morgan Stanley BUY Tencent Technology Closing price: NA Target price: NA Share price performance (%) 1wk: NA 3mths:NA 1mth:NA 1yr:NA Analyst Wallace Cheung recommends subscribing to the initial public offer of Tencent, an instant messenger tool provider in China. Tencent will be priced at a discount to most listed peers, Mr Cheung said in a report. 'Well entrenched in the potentially largest online market [in China] and with strong commitment to research and development, Tencent is poised for strong growth ahead,' he said. DBS Vickers Securities
