＜Research＞M Stanley: HANG SENG BANK to Announce Interim Results Next Wk; Further Buyback Expected as Shr Price Catalyst

　　Morgan Stanley highlighted in a report that HANG SENG BANK (00011.HK) +0.750 (+0.753%) Short selling $48.33M; Ratio 22.514% will announce its interim results at the end of the month. The broker expected the bank's share price to rise by 6% if it announced a further share buyback programme, but may fall by 3% if nothing is announced.

　　In the first hypothetical scenario, Morgan expected HANG SENG to have an estimated $14.5 billion of spare capital if it can raise its CET1 to about 16.5%, which is slightly higher than the post-2015 average. Following HANG SENG's earlier direction of considering all returns of surplus capital to shareholders, the broker forecasted that if the lender announced an additional $2 billion of share buybacks in 4Q24 and $7 billion of share buybacks in 2025 and 2026 respectively (i.e. a 10% buyback over the next three years), it would boost its 2027 EPS forecast by 6%.

　　In the second hypothetical scenario, if HANG SENG announced an accelerated dividend payout, the dividend yield for 2024 to 2026 would rise to 11.5% from the current 7.8%. However, given the temporary nature of the special dividend and the fact that Hang Seng's P/B ratio is already 1.1x, the stock price is not expected to react much.

　　Morgan maintained a target price of $97.1 on HANG SENG and rated it Equalweight.

　　(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2024-07-19 16:25.)

　　AAStocks Financial News