Morgan Stanley has released a research report predicting the impact on POP MART (09992.HK) to be low after factoring in the progress of US-China trade negotiations YTD.
Since around 75-80% of US toy imports come from China, even if these toys are subject to higher tariffs, it should not alter POP MART’s relative advantage.
Starting November 1, the US will impose a tariff of about 130% on Chinese toys. Morgan Stanley expects the impact on POP MART’s earnings this year to be about 1%, assuming no price adjustments will be made.
Morgan Stanley has set a target price of HKD382 for POP MART with an Overweight rating. It is also the broker’s top pick in the industry.
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