By Bingyan Wang


Shares of Anta Sports Products Ltd. fell after a weak quarterly sales report prompted some analysts to cut target prices amid concerns about the company's recovery.

The Hong Kong-listed shares of the Chinese sportswear company fell as much as 9.9% in midday trading Tuesday. They closed 3.6% lower at 78.80 Hong Kong dollars (US$10.04), taking year-to-date losses to almost 33%.

The company said in an operational update late Monday that the retail sales value of its Anta-brand products in the third quarter rose by a mid-single-digit percentage on year, while the retail sales value of its Fila-brand products rose by a low-teens percentage on year. The retail sales value of all other products rose 40%-45% on year.

Analysts said the positive growth was due to a low comparison base.

The growth was "decent" but "looks less impressive if we take into account the easier comps in 3Q," Bocom International analysts said in a research note. They noted that management indicated that second-half sales growth guidance is "at risk and likely will only arrive at the low end."

Bocom cut its forecast for the company's 2022-2023 earnings per share by 5%-6%, citing soft foot traffic amid the Covid-19 pandemic and a lack of a "clear inflection for recovery." The brokerage lowered its target price to HK$101 from HK$122, while keeping its buy rating.

Nomura analysts Cathy Xiao and Jizhou Dong said Anta's near-term sales trends may face uncertainties, as China's ongoing Covid-19 restrictions soften consumer sentiment. Nomura trimmed its forecast for 2022-2024 net profit slightly, and lowered its target price to HK$123.00 from HK$126.40, given "current relatively weak consumer sentiment and more intense industry competition." The Japanese bank maintained its buy rating.

CGS-CIMB analyst Lei Yang said the fourth-quarter outlook has become more conservative, but added that Anta "still has large room to improve its market share and margins in the long run." The analyst kept an add rating and an unchanged target price of HK$136.


Write to Bingyan Wang at bingyan.wang@wsj.com


(END) Dow Jones Newswires

10-18-22 0652ET