The analyst rating for SJM Holdings (00880.HK) is maintained at "Hold" by HSBC Global Research due to the following reasons: 1. Performance in Line with Expectations: The company's 3Q25 results were broadly in line with expectations, indicating stability in its financial performance. 2. Self-Operated Casinos Outperforming: The performance of self-operated casinos exceeded expectations, which is a positive sign for the company's core operations. 3. Weak Satellite Casino Results: The overall performance was offset by weaker results from satellite casinos, which have seen a decrease in market share from 5.1% to 3.9% as the company winds down this segment. 4. Potential for Market Share Recovery: A new agreement allowing SJM Holdings to directly contact satellite casino customers starting in November is expected to help recover some of the lost market share, suggesting potential for future growth. 5. Target Price and Upside Potential: HSBC has set a target price of $2.6, and if the transition of satellite casinos proceeds smoothly, there is potential for earnings upside. These factors contribute to the decision to maintain a "Hold" rating, reflecting cautious optimism about the company's future performance.

Morgan Stanley

Hold

Underweight

downgrade

$2.8

2025-11-13

Reason

Morgan Stanley

Price Target

$2.8

2025-11-13

downgrade

Hold

Underweight

Reason

The analyst rating for SJM HOLDINGS was downgraded to Underweight by Morgan Stanley due to several key factors: 1. Decline in Mass Market Share: The mass market share decreased by 110 basis points, primarily attributed to challenges from satellite casino operations. 2. High Debt Levels: The company's net debt reached $21.8 billion, resulting in a net debt to EBITDA ratio of 6.2x, which is the highest in Macau. This raises concerns about financial stability. 3. Overly Optimistic EBITDA Projections: The market's expectation for a full-year group EBITDA of $3.529 billion, which implies a 14% QoQ growth to $1.002 billion in 4Q25, was considered too high by the broker. 4. Anticipated Increase in Debt Ratio: The expected completion of the acquisition of L'Arch and Ponte 16 in 4Q25 is likely to further increase the debt ratio, adding to the financial concerns. These factors led Morgan Stanley to set a target price of $2.8 for the stock, reflecting a cautious outlook on the company's performance.

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00880 Should I Buy

00880 Should I Buy

Should You Buy SJM HOLDINGS (00880) Today? Analysis, Price Targets, and 2026 Outlook.

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