Goldman Sachs lowered its target price for China Tower (00788) to HK$1.95 from HK$2.17 and maintained its "neutral" rating.
The research house said China Tower's 3Q results were below Goldman's expectation as revenue growth further decelerated to 4.1% from 5.5% in 2Q and 9.6% in 1Q.
Three main reasons contributed to the slowing growth: (1) maintenance contract price decline, (2) slower deployment of 4G, (3) partial charging of 5G. In addition, management also changed 2020 guidance to "stable" from previously "high-single-digit" growth.
Following the results, Goldman revised down its revenue/EBITDA/net income forecast by 1.5%/1.5%/12.0% for 2019 to reflect the slower revenue growth and more conservative management guidance.
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