The analyst rating for TRAD CHI MED (00570.HK) is Underweight, with a target price of HKD1.5, due to several factors. Morgan Stanley predicts a 70-80% chance of the stock price falling in the next 30 days, primarily because of a profit warning indicating that the company expects to record a loss in FY25 for the first time since 2013. Additionally, TRAD CHI MED is facing challenges from a shrinking market size and has not disclosed specific plans for expansion or exploring new markets through internal resources or mergers and acquisitions. This lack of visibility on its 2026 performance contributes to the expectation of further downside in the stock price.

Morgan Stanley

Underweight

downgrade

2025-12-30

Reason

Morgan Stanley

Price Target

2025-12-30

downgrade

Underweight

Reason

The analyst rating for TRAD CHI MED (00570.HK) was lowered to Underweight by Morgan Stanley due to several factors: 1. Lowered Earnings Forecasts: The firm reduced its 2025-2040 earnings forecasts by 10-14% because of anticipated higher impairment provisions linked to price cuts for Chinese medicine formula granules. 2. Missed Market Expectations: The company's results have consistently fallen short of market expectations, indicating a decline in the quality of earnings. 3. Negative Perception of Governance: The termination of a significant transaction last year has contributed to a negative perception of the company's governance among investors. 4. Ongoing Selling Pressure: The broker anticipates that selling pressure on the stock will continue, as event-driven investors are likely to further reduce their holdings. These factors collectively led to a reduction in the target price from $1.6 to $1.5.

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00570 Should I Buy

00570 Should I Buy

Should You Buy TRAD CHI MED (00570) Today? Analysis, Price Targets, and 2026 Outlook.

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