The analyst rating from Citi Research for CHINA RES LAND, LONGFOR GROUP, and POLY DEVELOPMENTS is maintained at "Buy" despite the overall weakness in China's real estate sector in 4Q25. The reasons for the ratings and target price adjustments include:
1. Weak Sales Performance: The real estate sector experienced significant declines in sales, with a 36% year-over-year drop for listed property developers in November and a projected 40% decline in December.
2. Lower Earnings Forecasts: Citi Research lowered its earnings forecasts for these companies due to reduced profit margins in property development. Specifically, earnings forecasts were cut by 10%-11% for CHINA RES LAND, 25%-89% for LONGFOR GROUP, and 22%-83% for POLY DEVELOPMENTS.
3. Target Price Reductions: The target prices were adjusted downward to reflect the lowered earnings projections, with CHINA RES LAND's target price reduced from $39.62 to $35, LONGFOR GROUP's from $15.8 to $13.8, and POLY DEVELOPMENTS' from RMB9.5 to RMB7.5.
Despite these challenges, the "Buy" rating suggests that the analysts believe these companies still have potential for recovery or value in the long term.
