Lyon: China Unicom's performance in the second half of last year was disappointing, and the target price has been lowered to 8.8 Hong Kong dollars.

Lyon published a research report stating that China Unicom's performance in the second half of last year was disappointing, with total service revenue and net profit falling by 0.6% and 7.2% respectively compared to the previous year. This was mainly due to a decrease in connectivity and communication revenue, as well as moderate growth in revenue from computing and smart digital applications. The company has stopped disclosing its revenue composition and is strictly implementing a transformation from scale expansion to quality growth. China Unicom paid a dividend of 41.7 cents per share for the full year last year, with a payout ratio of approximately 6%. The company expects capital expenditures to decrease by 8% annually in 2026, which will help increase profits and dividends, but the increase in dividends may slow down. The bank has lowered its net profit forecasts for China Unicom for this year and next year by 11%, lowering the target price from HKD 11 to HKD 8.8, reflecting weak revenue growth, with a rating of "outperform the market".