20160127-招商证券_香港_-CMS_HK__Research_Highlights_12页_1mb_1mb

CMS(HK) Research Highlights Summary

Core Content

Apple's CY4Q15 results show a slight revenue miss due to currency effects, but net profit exceeded expectations. iPhone shipments were in line with consensus, while average selling price (ASP) was a positive surprise, attributed to upgrades in camera pixels and taptic engine for 3D touch. However, the CY1Q16 guidance is disappointing, indicating a 9-14% YoY revenue decline and a lower gross profit margin (GPM) than the consensus. The guidance is below market expectations, and the decline is expected to be more severe when adjusted for constant currency. Strong iPhone shipments in India were noted, while China saw a significant portion of sales to first-time buyers in CY4Q15.

Main Points

• Apple CY4Q15 Performance:

  • Revenue: US$75.9bn (+2% YoY), slightly below consensus.
  • Net Profit: US$18.4bn (+2% YoY), exceeding expectations.
  • Gross Margin: 40.1% (vs. consensus 39.9%), an increase.
  • iPhone Shipments: 74.8mn units (vs. consensus 75mn), largely in line.
  • ASP: US$691, 2% above consensus, driven by camera and taptic engine upgrades.

• CY1Q16 Guidance:

  • Revenue: US$50-53bn, a 9-14% YoY decline (vs. consensus of US$55.7bn).
  • GPM: 39-39.5% (vs. consensus of 40.0%).
  • Adjusted for constant currency, revenue is expected to decline by 5-10%, which is more severe than the current guidance.

• Market Impact:

  • iPhone 6s demand is dragging down guidance.
  • Market estimates for CY1Q16 iPhone shipments are expected to be trimmed further.
  • AAC (2018 HK) is rated as BUY, while Cowell (1415 HK) is rated as NEUTRAL.

Key Information

• Stock Market Indices:

  • Hang Seng Index: Closed at 18860, -2.48%.
  • Hang Seng Finance Index: Closed at 25551, -2.92%.
  • Hang Seng Utilities Index: Closed at 46974, -0.97%.
  • Hang Seng Property Index: Closed at 24615, -2.18%.
  • Hang Seng Industrial Index: Closed at 11192, -2.26%.
  • HSCEI: Closed at 7895, -3.4%.
  • CSI 300: Closed at 2940, -6.02%.
  • Shanghai Composite Index: Closed at 2749, -6.42%.
  • TWSE: Closed at 7828, -0.83%.

• Global Markets:

  • Brent Oil: $31.6, +3.61%.
  • COMEX Gold: $1121.6, +1.47%.
  • COMEX Copper: $203.7, +2.34%.
  • LME Aluminum: $1485.0, +0.2%.
  • LME Copper: $4444.5, +0.33%.
  • BDI: 345.0, -2.54%.

• Exchange and Interest Rates:

  • USD/RMB: 6.58, +0.04%.
  • USD/HKD: 7.79, 0% change.
  • EUR/USD: 1.09, +0.01%.
  • 1Y RMB NDF: 6.86, +0.24%.
  • 3M Libor: 0.62, +0.36%.
  • 3M Shibor: 3.07, +1.04%.
  • 10Y US T-Note Yield: 2.03, -1.93%.

Research Coverage Highlights

Auto & Auto Parts

• Brilliance China (1114 HK): BUY, with a 12-month target price of HK$12.5, 36% upside.
• China ZhengTong Auto (1728 HK): BUY, with a 12-month target price of HK$5.48, 30% upside.
• Geely Automobile (175 HK): BUY, with a 12-month target price of HK$4.8, 36% upside.
• BAIC Motor (1958 HK): NEUTRAL, with a 12-month target price of HK$8.0, 18% upside.
• Great Wall Motor (2333 HK): BUY, with a 12-month target price of HK$12.5, 37% upside.
• Fuyao Glass (3606 HK): BUY, with a 12-month target price of HK$20.0, 38% upside.

Oil and Gas

• Sinopec Oilfield Service (1033 HK): NEUTRAL, with a 12-month target price of HK$2.7, 39% upside.
• China Oilfield Services (2883 HK): NEUTRAL, with a 12-month target price of HK$8.7, 39% upside.
• Petrochina (857 HK): BUY, with a 12-month target price of HK$8.3, 54% upside.
• CNOOC (883 HK): BUY, with a 12-month target price of HK$10.8, 53% upside.

Property

• China Resources Land (1109 HK): BUY, with a 12-month target price of HK$23.8, 42% upside.
• Yuzhou Property (1628 HK): BUY, with a 12-month target price of HK$2.4, 43% upside.
• KWG Property (1813 HK): NEUTRAL, with a 12-month target price of HK$5.9, 39% upside.
• Country Garden (2007 HK): NEUTRAL, with a 12-month target price of HK$2.7, 43% upside.
• Agile Property (3383 HK): BUY, with a 12-month target price of HK$12.0, 65% upside.

Technology, Media & Telecom

• China Telecom (728 HK): NEUTRAL, with a 12-month target price of HK$4.37, 23% upside.
• China Unicom (762 HK): BUY, with a 12-month target price of HK$12.21, 42% upside.
• China Mobile (941 HK): BUY, with a 12-month target price of HK$117.5, 75% upside.

Other Sectors

• Hardware Technology:

  • AAC Technologies (2018 HK): BUY, with a 12-month target price of HK$63.4, 26% upside.
  • Cowell (1415 HK): NEUTRAL, with a 12-month target price of HK$4.05, 79% upside.

• Textile & Garment:

  • China Lilang (1234 HK): BUY, with a 12-month target price of HK$8.04, 82% upside.
  • 361 Degrees (1361 HK): BUY, with a 12-month target price of HK$3.61, 52% upside.
  • ANTA Sports Products (2020 HK): BUY, with a 12-month target price of HK$24.44, 37% upside.

• Food & Beverage:

  • GCL-Poly Energy (3800 HK): BUY, with a 12-month target price of HK$1.94, 100% upside.
  • China Longyuan Power (916 HK): BUY, with a 12-month target price of HK$6.9, 54% upside.
  • Xinyi Solar (968 HK): BUY, with a 12-month target price of HK$4.2, 62% upside.

• Port & Shipping:

  • SITC (1308 HK): BUY, with a 12-month target price of HK$4.85, 42% upside.
  • China Merchants Hldg (144 HK): BUY, with a 12-month target price of HK$32.3, 59% upside.
  • Orient Overseas (316 HK): BUY, with a 12-month target price of HK$55.5, 75% upside.

• Banking:

  • ABC (1288 HK): BUY, with a 12-month target price of HK$4.76, 76% upside.
  • ICBC (1398 HK): BUY, with a 12-month target price of HK$7.51, 95% upside.
  • BOC (3988 HK): BUY, with a 12-month target price of HK$5.98, 102% upside.
  • CITIC Bank (998 HK): SELL, with a 12-month target price of HK$4.08, -6% upside.

• Insurance:

  • AIA (1299 HK): BUY, with a 12-month target price of HK$60.91, 46% upside.
  • NCI (1336 HK): BUY, with a 12-month target price of HK$49.88, 94% upside.
  • Ping An insurance group (2318 HK): BUY, with a 12-month target price of HK$63.47, 87% upside.

What to Watch

Economic Data

• U.S.:

  • API weekly crude stocks: Not provided.
  • New Home Sales-Units MM: Not provided.
  • Fed Funds Target Rate: Forecast at 0.38%.
  • EIA Weekly Crude Stocks: Not provided.
  • Durable Goods: Forecast at -1%.
  • GDP Advance: Forecast at 1.30%.
  • Core PCE Prices: Forecast at 1.30%.
  • Employment Costs: Forecast at 0.60%.

• Germany:

  • GfK Consumer Sentiment: Forecast at 9.3.
  • Nationwide house price mm: Forecast at 0.50%.
  • CPI Prelim MM: Forecast at -0.80%.
  • HICP Prelim MM: Forecast at -1%.

• Euro zone:

  • Business Climate: Forecast at 0.39.
  • Economic Sentiment: Forecast at 106.6.

Company Events

• Vinda International Holdings Ltd. (3331 HK): FIN RES/DIV (Y.E.31/12/15) on 2016/01/27.

Risk Reminder

• The new energy vehicle industry is under risk due to the increased volume of ternary materials, with almost zero tolerance for the probability of fire accidents.