BofA Securities has released a research report revising its outlook on WH Group (00288), lowering the target price from HK$11.5 to HK$9.6 while reiterating a "Buy" rating.

The brokerage projects that WH Group's dividend per share for fiscal year 2026 will hold steady at HK$0.61 year-on-year, implying a prospective dividend yield of approximately 7.7% for the current year. This forecast, coupled with the potential for an additional special dividend, underpins the firm's continued positive stance on the stock.

In the second quarter, the company reported an operating profit that declined 11.3% year-on-year, falling short of expectations, while net profit rose 4.1% year-on-year, aligning with consensus estimates. Looking ahead, BofA Securities anticipates that WH Group's operations in China will stabilize, but its U.S. business is likely to encounter headwinds, particularly during the fourth quarter.

Consequently, the firm has reduced its earnings per share estimates for fiscal years 2026 and 2027 by 10% and 9%, respectively, prudently forecasting a 5% decline in EPS for fiscal year 2026.

Where to Begin

For investors tracking this development, the revised target price reflects a more cautious near-term outlook for the company's international segments, while the maintained Buy rating signals confidence in its longer-term dividend sustainability and underlying value.