HK Stock Market Move | TOPSPORTS(06110) rose more than 8%, Adidas sales in Greater China are impressive, the company has high dividend payout capabilities.

TOPSPORTS (06110) rose by more than 8%, reaching 8.11% at the time of publication, at HK$4 per share with a turnover of HK$2.79 billion. On the news front, Adidas has announced its latest performance results, showing global revenue of 23.683 billion euros for the full year 2024, a 12% increase year-on-year on a currency-neutral basis. During the same period, the company's operating profit increased by over 1 billion euros year-on-year, reaching 1.337 billion euros; gross profit margin also increased by 3.3 percentage points to 50.8% compared to the same period last year. The performance in the Greater China region in 2024 is returning to a faster growth trajectory. In the fourth quarter of 2024, Adidas Greater China achieved revenue of 794 million euros, a year-on-year increase of 16.1%, achieving growth for seven consecutive quarters, with full-year revenue of 3.459 billion euros, a year-on-year increase of 10.3%. It is reported that TOPSPORTS is currently the largest distributor of Adidas globally and the second-largest distributor of Nike globally. Sinolink pointed out that the company's internal product mix of Nike and Adidas accounts for close to 85%, therefore the company's performance is closely related to the performance of Nike and Adidas. The expected recovery of Nike and Adidas operations in the future is expected to drive the company's performance in a positive direction. In addition, the company's average dividend payout ratio over the past three years is 104%, with a dividend yield of 7.2% for FY2024, significantly higher than other comparable companies. Looking at the company's cash flow situation, the company's net current ratio has been maintained between 1.4-3.0 in recent years, with a strong cash flow ensuring the company's dividend distribution capability. The bank recommends focusing on the company as a high-dividend investment value.