Thursday, May 26, 2011

UBS cuts Hutchison Port target to US$1.10 vs US$1.17

Stock Name: HPH Trust US$
Company Name: HUTCHISON PORT HOLDINGS TRUST
Research House: UBS

UBS has lowered its target price for Singapore-listed Hutchison Port Holdings Trust (HPHT.SI) to US$1.10 ($1.37) from US$1.17 and kept its buy rating.

UBS has cut its target price for Hutchison as it expects the trust to pay out more conservative dividends after 2022. It also assumed a higher cost of equity of 8.3% for Hutchison, versus 8.1% previously.

However, the brokerage has kept its buy rating as it believes Hutchison Port still has significant advantages over its peers, such as a stronger control over its cash flow.
At 11:32 a.m., shares of Hutchison Port Holdings were 0.55% lower at US$0.905 and have fallen about 4% since its debut in March. Hutchison Port, controlled by Hong Kong tycoon Li Ka-shing's Hutchison Whampoa (0013.HK), sold units at the IPO at US$1.01 each.

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