Core Viewpoint - Morgan Stanley has raised the target price for Coca-Cola, indicating that the company is expected to serve as a safe haven in turbulent markets, with a target price of $78, representing a 6% upside from the current stock price and a dividend yield of approximately 3% [1] Group 1: Company Resilience and Performance - Coca-Cola has demonstrated exceptional operational capabilities over the past five years, achieving a compound annual growth rate (CAGR) of 7.7% in organic sales growth [2] - The company's geographic diversification mitigates risks, with only about 17% of total system sales coming from the U.S., allowing strong performance in other markets to offset weaknesses in specific regions [2] - Coca-Cola's strategic focus on marketing, innovation, and business execution has supported its stable growth in a dynamic global operating environment [2] Group 2: Impact of Tariffs - The overall impact of tariffs on Coca-Cola is considered limited and manageable, with the juice segment facing the most direct effects [3] - Juice sales account for approximately 4.5% of Coca-Cola's revenue, with a 10% tariff on imports from Brazil, while imports from Mexico are currently exempt [3] - The company is expected to manage cost increases from tariffs on steel and aluminum through its procurement teams and may shift packaging strategies if aluminum costs rise [3] Group 3: Market Performance and Valuation - Coca-Cola's stock has outperformed the market, with a year-to-date increase of 16.8%, compared to a 12.3% decline in the S&P 500 [4] - The company's current trading price is over 20% higher than the S&P 500, reflecting its status as a safe haven in the consumer staples sector [4] - Morgan Stanley projects a 5.8% organic sales growth rate for Coca-Cola in 2025, with expected revenue of $48.353 billion, a 3.1% year-over-year increase [7] Group 4: Comparison with Competitors - Compared to PepsiCo, Coca-Cola's defensive characteristics and higher profitability make it more attractive in the current market environment [8] - PepsiCo's performance is hindered by a weak U.S. snack market and slower growth in international markets, leading to greater growth pressures [8] - Morgan Stanley maintains a neutral rating on PepsiCo with a target price of $159, which has an 11% upside, but notes a lack of short-term catalysts [9]

Core Viewpoint - Verizon has shown resilience in a challenging market, achieving over 6% positive returns year-to-date, contrasting with a 14% decline in the broader market [1] Financial Performance - Verizon has consistently met or exceeded earnings expectations for the past 10 quarters, averaging a 1.4% beat per quarter, but has only exceeded revenue expectations 50% of the time, with an average revenue miss of 0.2% per quarter [2] - Key metrics to watch for the upcoming first quarter include expected revenue of $33.3 billion and a standardized EPS of $1.15, with anticipated year-over-year revenue growth of less than 1% [4] - The company is facing increased competitive pressure from AT&T and T-Mobile, which may lead to higher customer churn rates and stagnant postpaid net additions despite a strong fourth quarter [4][6] Strategic Initiatives - Verizon's management is focusing on enhancing customer experience through initiatives like the myPlan and personalized services, which may help mitigate potential user growth challenges [6] - Price increases are expected to generate approximately $1 billion in incremental revenue, with wireless service revenue projected to grow 2-2.8% year-over-year [6] Debt and Cash Flow - Verizon has a significant debt burden of $144 billion, with 82% being unsecured, leading to scrutiny over its ability to generate free cash flow [7] - Expected free cash flow for FY25 is projected to decline by about 9% to $18 billion, with cash dividend outflows potentially reaching $11.5 billion [8][9] Valuation and Market Position - Verizon's current dividend yield of over 6% is attractive but not significantly better than the industry average of 6.2% [9][10] - The stock's forward valuation is not considered cheap, trading at a premium compared to its five-year average rolling P/E ratio of 8.4 times [12] - Expected EPS growth for the year is less than 2%, resulting in a high PEG ratio of over 5, indicating that the current premium may not be justified [14]

Core Viewpoint - HSBC's report indicates that China Hongqiao's strong performance in the second half of 2024 aligns with market expectations, driven by rising bauxite and aluminum prices, as well as ongoing bauxite shortages [1] Group 1: Financial Performance - China Hongqiao reported a net profit after tax (NPAT) of approximately RMB 22.4 billion for 2024, representing a 95% year-on-year increase, with the second half profit around RMB 13.2 billion, up 47% year-on-year [2] - The strong performance is attributed to a significant increase in alumina prices (up 78% year-on-year) due to bauxite shortages, and a 14% year-on-year rise in aluminum prices in the second half of 2024 [2] - The overall gross profit margin improved to 29.5% in the second half of 2024, up from 24.2% in the first half, with alumina profit margins increasing 4.2 times [2] Group 2: Dividend and Shareholder Returns - China Hongqiao proposed a final dividend of HKD 1.02 per share, in addition to an interim dividend of HKD 0.59 per share, resulting in a total payout ratio of 63% for 2024, compared to approximately 47% in 2023 [2] - The expected dividend yield is over 11%, exceeding HSBC's expectations [2] Group 3: Future Outlook - HSBC forecasts capital expenditures for 2025 to be between RMB 10 billion and RMB 13 billion, similar to 2024, with aluminum prices expected to stabilize between RMB 20,500 and RMB 21,500 per ton [3] - China Hongqiao does not plan to expand aluminum production capacity, with more capacity expected to be relocated to Yunnan before the rainy season in 2025 [3] - Despite an anticipated 8% decline in profits for 2025, HSBC identifies strong upward catalysts, including recovering demand and supportive domestic consumption policies [3] Group 4: Valuation and Target Price - HSBC raised the target price for China Hongqiao from HKD 16.00 to HKD 17.10, maintaining a "Buy" rating [4] - The target price is based on a forward P/E ratio of 7.5x applied to the estimated earnings per share of RMB 2.16 for 2025, reflecting a significant upside potential given the robust fundamentals and a dividend yield exceeding 10% [4]

Core Viewpoint - Goldman Sachs assigns a "Neutral" rating to Sinopec (00386, 600028.SH) with a target price of HKD 4.50, citing expected weak free cash flow due to declining refining margins and oversupply in the chemical market [1] Group 1: Financial Performance - Sinopec's fourth-quarter performance in refining, sales, and chemical sectors fell short of expectations, with EBITDA 19% lower than Goldman Sachs' forecast due to higher operational costs [2] - The company's gross profit met expectations, but overall performance was impacted by lower-than-expected profit margins across multiple business segments [2] Group 2: Dividend and Cash Flow - The dividend payout ratio for 2024 is expected to remain around 71%, consistent with 2023, leading to a 17% year-on-year decline in earnings per share dividends [3] - Despite a projected positive free cash flow in 2024 after two years of negative results, the free cash flow yield of 1.3% is below Goldman Sachs' expectation of 5% due to lower earnings and high capital expenditures [3] - Capital expenditures for 2024 are expected to be 11% higher than Goldman Sachs' forecast, with a slight decrease of 1% compared to 2023, and a projected capital expenditure of RMB 164.3 billion for 2025, which is 6% above expectations [3]