Bank of America Securities: Raises HUANENG POWER's (00902) target price to 6 Hong Kong dollars, reiterates "buy" rating.

Bank of America Securities released a research report stating that HUANENG POWER (00902) is expected to achieve a dividend yield of 8.3% by 2025 while maintaining a dividend payout ratio of 58%, which is the highest among its peers covered by the bank. The company's free cash flow has also significantly improved. The bank reiterated a "buy" rating, anticipating that the continuous improvement in thermal power profitability in the coming months will drive a revaluation of the stock. The target price for the company's Hong Kong-listed shares has been raised from HK$5.5 to HK$6, while the target price for its A-shares (600011.SH) has been adjusted from RMB 9.7 to RMB 8.4 based on the premium of AH shares. Investors are advised to pay attention to the resilience of coal-fired power prices of HUANENG POWER. Due to better-than-expected performance, the bank has raised its profit forecasts for Huaneng National Power for 2025 and 2026 by 16% and 3% respectively, reflecting a decrease in interest expenses and other costs, as well as adjustments in thermal, wind, and photovoltaic power prices in 2026.