JP Morgan: The earnings per share and dividend yield of MGM China (02282) this year is expected to decrease, and the rating has been downgraded to "Neutral".
Expected earnings per share for MGM China in fiscal year 2026 are expected to decline by 11%, which means the dividend yield may also further decrease. Unless the company increases its dividend payout ratio or declares a special dividend, which seems unlikely at the moment.
JPMorgan releases research report, stating that MGM CHINA (02282) announced a final dividend of HK$0.35 per share, with a full-year dividend payout ratio of 50%, resulting in a dividend yield of 5.5%, not bad, but the industry has raised the average dividend payout ratio to about 70%, increasing market expectations for MGM. Despite meeting dividend payout expectations, due to unexpectedly weak earnings per share, the final dividend is about 10% lower than the bank and market forecasts. The bank pointed out that, furthermore, due to the increase in license fees, MGM CHINA's earnings per share for fiscal year 2026 are expected to decline by 11%, potentially causing the dividend payout ratio to further decrease, unless the company increases the dividend payout ratio or pays a special dividend, which seems unlikely at present. JP Morgan has downgraded MGM CHINA's rating to "Neutral."
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