Citigroup cut target price of Apple supplier Sunny Optical to HK$140, rating unchanged at Buy
MARKET STOCKS
Citigroup cut target price of Apple supplier Sunny Optical to HK$140, rating unchanged at Buy
MARKET STOCKS

Citigroup cut target price of Apple supplier Sunny Optical to HK$140, rating unchanged at Buy

 

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Sunny Optical, which has been a top pick on the Android recovery trade since the fourth quarter of 2022, has rebounded 75% from its trough so far, and despite the lower valuation, market optimism may weaken and the stock may encounter profit-taking pressure with shipment data during the Chinese New Year holidays being released, Citigroup said in a note.

The robust momentum of Sunny Optical appeared to have faltered after the holidays and its shipment data in January is likely to remain lackluster, which likely indicate short-term downside risk, according to the note.

Therefore, the broker opened a 30-day negative catalyst watch on the stock, expecting weakening data in the coming weeks after the holiday, according to the note.

Citigroup cut the target price for Sunny Optical from HK$160 to HK$140, but emphasized that its long-term view on a cyclical recovery for the company’s fundamentals remains unchanged. The rating for the stock was maintained at Buy.Â