M Stanley Lowers COSCO SHIP ENGY's Target Price to HKD12, Predicts Tight Supply Will Bolster Earnings Next Year
Morgan Stanley's Rating: Morgan Stanley maintains an Overweight rating on COSCO SHIP ENGY (01138.HK) but has cut its target price from HKD13 to HKD12.
Market Outlook: Despite concerns over shipping disruptions, Morgan Stanley anticipates that crude oil tanker earnings will remain strong next year, recommending the purchase of COSCO SHIP ENGY at a lower price.
Industry Growth Projections: The report indicates that global tanker capacity and demand are expected to grow by 2.2% and 1% YoY respectively, with crude oil tanker demand projected to increase by 0.9% YoY against a supply increase of only 0.7%.
Supply and Demand Dynamics: The supply balance for crude oil tankers, especially very large crude carriers, is expected to remain tight, highlighting a more favorable market condition for tanker operators.
Trade with 70% Backtested Accuracy
Analyst Views on 01138
About the author
HSI Closes 465 Points Lower; AIA and Stanchart Drop 4%; Commodity Stocks Decline
Market Overview: The DJIA fell 1.3% as tech stocks were sold off, leading to a similar decline in the Hong Kong stock market, where the HSI ended down 1.7% at 26,567.
Financial Sector Performance: Major financial stocks like HSBC and HKEX dropped by 2.7% and 2.1%, respectively, while Bank of East Asia plunged 11% after reporting a significant profit drop and dividend cut.
Commodity and Gold Prices: Gold prices fell below USD 5,000/oz, impacting gold mining stocks, which saw declines of 5.9-7.6%. Oil prices also dropped nearly 3%, affecting major oil companies.
Tech Sector Decline: The tech sector experienced minor declines, with Tencent and Alibaba seeing drops of around 0.7% to 2.0%, while other tech stocks like Meituan and Baidu fell over 3%.
<Midday Update> HSI Ends Midday at 27,023, Dropping 242 Points; HSTI at 5,407, Down 92 Points; MEITUAN Falls More Than 4%; WUXI APPTEC, WUXI BIO, SHK PPT, SINOPEC CORP, and HK & CHINA GAS Reach New Peaks
Market Performance: The Hang Seng Index (HSI) fell by 242 points (0.9%) to 27,023, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also experienced declines of 1.7% and 1.0%, respectively.
Active Heavyweights: Major stocks like Meituan, Tencent, Alibaba, and Xiaomi saw significant drops, with Meituan down 4.2% and Tencent down 2.6%, amidst high short selling activity.
Notable Movers: Wuxi AppTec and Wuxi Bio both hit new highs, increasing by 3.9% and 3.7%, respectively, while Bud APAC and Trip.com saw declines of 5% and 4.3%.
Short Selling Trends: High short selling ratios were observed across various stocks, with NetEase Music experiencing the largest drop of 11.9%, while Fit Hon Teng and COSCO Ship Energy saw substantial gains of over 10%.
G Sachs Increases COSCO SHIP ENGY's Target Price by 48% to HKD16, Anticipates Additional Gains in Freight Rates
Freight Rate Outlook: Goldman Sachs reports that international freight rates have potential for further increases due to the exit of shadow and sanctioned fleets, leading to reduced effective shipping capacity.
Impact on COSCO SHIP ENGY: The report suggests that COSCO SHIP ENGY will benefit from rising freight rates, particularly as Venezuelan oil transportation transitions from shadow fleets to mainstream fleets.
Target Price Adjustment: Goldman Sachs has raised its target price for COSCO SHIP ENGY by 48% to HKD16 while maintaining a Buy rating.
Market Data Note: The stock quote for COSCO SHIP ENGY is delayed by at least 15 minutes, with short selling data indicating significant activity.
Guotai Haitong Securities Predicts COSCO SHIP ENGY (01138.HK) Profit Will Reach Record Levels in 2025 with Target Price of $20.26
Oil Transportation Growth: The oil transportation sector has seen growth for four consecutive years, with expectations for COSCO SHIP ENGY to achieve record earnings in 2025 and a significant year-over-year increase in 1Q26 results.
Profit Forecast Adjustments: Guotai Haitong Securities has lowered its 2025 net profit forecast for COSCO SHIP ENGY to RMB4.5 billion while maintaining a forecast of RMB6.6 billion for 2026 and projecting RMB7 billion for 2027.
Market Outlook: The broker anticipates that the oil transportation market will continue to exceed expectations, particularly in foreign trade oil transportation earnings, despite challenges such as old ship dismantling.
Investment Rating: Guotai Haitong Securities has maintained an Overweight rating for COSCO SHIP ENGY, setting a target price of $20.26 for the company.
<Daily Summary> HSI Ends at 26,999, Gaining 151 Points; HSTI Finishes at 5,908, Up 38 Points; BABA Rises Over 5%; MEITUAN Declines Over 3%; ALI HEALTH, ZIJIN MINING, WANGUO GOLD GP, SANY INT'L, COSCO SHIP ENGY Reach New Peaks; Market Activity Increases
Market Performance: The Hang Seng Index (HSI) rose by 151 points (0.6%) to close at 26,999, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also saw gains, closing at 5,908 and 9,315 respectively, with a total market turnover of $340.39 billion.
Active Heavyweights: Notable stock movements included Alibaba (BABA) increasing by 5.7% to $169, while Meituan (03690.HK) fell by 3.2% to $101.5. Other significant changes included Tencent (up 0.9%) and Ping An (down 1.9%).
Top Gainers and Losers: Ali Health surged by 19% to $7.78, marking a new high, while Trip.com saw a decline of 6.5% to $569.5. Other notable gainers included Haidilao and Nongfu Spring, while Xinyi Glass and China Res Mixc experienced losses.
Small Cap Movements: Synagistics led the small-cap stocks with a remarkable 50.2% increase, while Dalipal Holdings dropped by 15.6%. Other significant movers included Guofuhee and Chervon, both showing strong gains.
<M Stanley Analysis> Ratings and Target Prices for Airlines, Shipping Companies, and Express Delivery Services (Table)
Airline Stock Performance: Air China, China Southern Airlines, and China Eastern Airlines experienced declines in share prices, while BOC Aviation and Travelsky Tech saw slight increases, with most airlines rated as "Overweight" by analysts.
Short Selling Activity: Significant short selling was noted across various airlines, with China Southern Airlines having the highest ratio at 18.053%, indicating investor skepticism about future performance.
Express Delivery Platforms: ZTO Express is rated "Overweight," while J&T Express and JD Logistics faced minor declines, with both rated as "Equalweight."
Shipping Sector Overview: COSCO Ship Energy showed a positive performance with a 3.431% increase, while other shipping companies like SITC and OOIL experienced declines, with varying ratings from "Overweight" to "Underweight."
HSI Closes 465 Points Lower; AIA and Stanchart Drop 4%; Commodity Stocks Decline
Market Overview: The DJIA fell 1.3% as tech stocks were sold off, leading to a similar decline in the Hong Kong stock market, where the HSI ended down 1.7% at 26,567.
Financial Sector Performance: Major financial stocks like HSBC and HKEX dropped by 2.7% and 2.1%, respectively, while Bank of East Asia plunged 11% after reporting a significant profit drop and dividend cut.
Commodity and Gold Prices: Gold prices fell below USD 5,000/oz, impacting gold mining stocks, which saw declines of 5.9-7.6%. Oil prices also dropped nearly 3%, affecting major oil companies.
Tech Sector Decline: The tech sector experienced minor declines, with Tencent and Alibaba seeing drops of around 0.7% to 2.0%, while other tech stocks like Meituan and Baidu fell over 3%.
<Midday Update> HSI Ends Midday at 27,023, Dropping 242 Points; HSTI at 5,407, Down 92 Points; MEITUAN Falls More Than 4%; WUXI APPTEC, WUXI BIO, SHK PPT, SINOPEC CORP, and HK & CHINA GAS Reach New Peaks
Market Performance: The Hang Seng Index (HSI) fell by 242 points (0.9%) to 27,023, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also experienced declines of 1.7% and 1.0%, respectively.
Active Heavyweights: Major stocks like Meituan, Tencent, Alibaba, and Xiaomi saw significant drops, with Meituan down 4.2% and Tencent down 2.6%, amidst high short selling activity.
Notable Movers: Wuxi AppTec and Wuxi Bio both hit new highs, increasing by 3.9% and 3.7%, respectively, while Bud APAC and Trip.com saw declines of 5% and 4.3%.
Short Selling Trends: High short selling ratios were observed across various stocks, with NetEase Music experiencing the largest drop of 11.9%, while Fit Hon Teng and COSCO Ship Energy saw substantial gains of over 10%.
G Sachs Increases COSCO SHIP ENGY's Target Price by 48% to HKD16, Anticipates Additional Gains in Freight Rates
Freight Rate Outlook: Goldman Sachs reports that international freight rates have potential for further increases due to the exit of shadow and sanctioned fleets, leading to reduced effective shipping capacity.
Impact on COSCO SHIP ENGY: The report suggests that COSCO SHIP ENGY will benefit from rising freight rates, particularly as Venezuelan oil transportation transitions from shadow fleets to mainstream fleets.
Target Price Adjustment: Goldman Sachs has raised its target price for COSCO SHIP ENGY by 48% to HKD16 while maintaining a Buy rating.
Market Data Note: The stock quote for COSCO SHIP ENGY is delayed by at least 15 minutes, with short selling data indicating significant activity.
Guotai Haitong Securities Predicts COSCO SHIP ENGY (01138.HK) Profit Will Reach Record Levels in 2025 with Target Price of $20.26
Oil Transportation Growth: The oil transportation sector has seen growth for four consecutive years, with expectations for COSCO SHIP ENGY to achieve record earnings in 2025 and a significant year-over-year increase in 1Q26 results.
Profit Forecast Adjustments: Guotai Haitong Securities has lowered its 2025 net profit forecast for COSCO SHIP ENGY to RMB4.5 billion while maintaining a forecast of RMB6.6 billion for 2026 and projecting RMB7 billion for 2027.
Market Outlook: The broker anticipates that the oil transportation market will continue to exceed expectations, particularly in foreign trade oil transportation earnings, despite challenges such as old ship dismantling.
Investment Rating: Guotai Haitong Securities has maintained an Overweight rating for COSCO SHIP ENGY, setting a target price of $20.26 for the company.
<Daily Summary> HSI Ends at 26,999, Gaining 151 Points; HSTI Finishes at 5,908, Up 38 Points; BABA Rises Over 5%; MEITUAN Declines Over 3%; ALI HEALTH, ZIJIN MINING, WANGUO GOLD GP, SANY INT'L, COSCO SHIP ENGY Reach New Peaks; Market Activity Increases
Market Performance: The Hang Seng Index (HSI) rose by 151 points (0.6%) to close at 26,999, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also saw gains, closing at 5,908 and 9,315 respectively, with a total market turnover of $340.39 billion.
Active Heavyweights: Notable stock movements included Alibaba (BABA) increasing by 5.7% to $169, while Meituan (03690.HK) fell by 3.2% to $101.5. Other significant changes included Tencent (up 0.9%) and Ping An (down 1.9%).
Top Gainers and Losers: Ali Health surged by 19% to $7.78, marking a new high, while Trip.com saw a decline of 6.5% to $569.5. Other notable gainers included Haidilao and Nongfu Spring, while Xinyi Glass and China Res Mixc experienced losses.
Small Cap Movements: Synagistics led the small-cap stocks with a remarkable 50.2% increase, while Dalipal Holdings dropped by 15.6%. Other significant movers included Guofuhee and Chervon, both showing strong gains.
<M Stanley Analysis> Ratings and Target Prices for Airlines, Shipping Companies, and Express Delivery Services (Table)
Airline Stock Performance: Air China, China Southern Airlines, and China Eastern Airlines experienced declines in share prices, while BOC Aviation and Travelsky Tech saw slight increases, with most airlines rated as "Overweight" by analysts.
Short Selling Activity: Significant short selling was noted across various airlines, with China Southern Airlines having the highest ratio at 18.053%, indicating investor skepticism about future performance.
Express Delivery Platforms: ZTO Express is rated "Overweight," while J&T Express and JD Logistics faced minor declines, with both rated as "Equalweight."
Shipping Sector Overview: COSCO Ship Energy showed a positive performance with a 3.431% increase, while other shipping companies like SITC and OOIL experienced declines, with varying ratings from "Overweight" to "Underweight."
