Shares of the China-based ANTA Sports Products Ltd. (HK:2020) gained nearly 5% today following the company’s announcement of a $1.3 billion (HK$10 billion) share buyback plan. The stock gained despite the company reporting mixed interim results for 2024. ANTA will complete this buyback over the next 18 months.
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In a similar move, Hong Kong-listed e-commerce company JD.com (HK:9618) announced a $5 billion share buyback plan yesterday. This decision follows the company’s solid results for the June quarter, reported earlier this month. These massive buybacks by Chinese firms aim to reassure investors about their growth potential amid a challenging macroeconomic environment.
ANTA Sports is a multinational company that specializes in a wide range of sports equipment and other sportswear and accessories.
ANTA Reports H1 Results
For the first half of 2024, ANTA reported a 13.8% year-over-year growth in its revenues to ¥33.7 billion. The company also maintained a strong operating efficiency, with its operating profit margin staying steady at 25.7%. Meanwhile, the company’s profit attributable to its shareholders increased by 17% year-over-year to ¥6.16 billion.
In terms of shareholder returns, ANTA announced an interim dividend of HK$1.18 per ordinary share in the first half, marking a 43.9% year-over-year increase.
Jefferies Remains Bullish on ANTA
Overall, analyst John Chou from Jefferies remains optimistic about ANTA stock, though he notes that the weaker consumption environment in China is a concern. According to Jefferies, the company’s reduced annual retail sales target for its FILA brand, combined with unchanged guidance for its ANTA brand, presents a mixed outlook for investors.
Chou reduced his price target for ANTA stock from HK$135 to HK$120 while maintaining a Buy rating on the stock.
Similarly, analysts from CMB International and DBS also reiterated a Buy rating on the stock after the H1 results.
Is ANTA Sports a Buy?
According to TipRanks, 2020 stock has received a Strong Buy consensus rating, backed by all Buy recommendations from eight analysts. The ANTA Sports share price forecast is HK$121.52, which implies a huge upside of 70% on the current trading level.
