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Investing.com - Goldman Sachs has upgraded A-Living Services (HK:3319) stock rating from Sell to Neutral and raised its price target to HK$3.00 from HK$2.45.
The upgrade comes after A-Living shares rose 7% since Goldman Sachs added the company to its Sell list on January 22, 2024, underperforming both the sector average gain of 36% and MSCI China’s 68% increase during the same period.
Goldman Sachs notes that A-Living has spent several years optimizing its portfolio and restructuring its business, including exiting lower-performing property management projects and city service contracts.
The firm also highlights A-Living’s reduced risk exposure to heavily-indebted affiliated developers and government customers with low cash collection visibility.
Goldman Sachs expects A-Living’s recurring revenue and cash profitability to stabilize from 2026 onward, supporting stable free cash flow generation and shareholder returns, though it remains less positive on the company’s ability to resume business growth amid intensified competition and macroeconomic weakness.
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