As oil prices continue to hover at $80 per barrel for a long time, Goldman Sachs expects CNPC's cash flow to turn into strong dividends and potential buybacks.
The Zhitong Finance App learned that Goldman Sachs released a research report stating that it gave CNPC (00857) a “buy” rating, with a target price of HK$6.8. The 2023 EBITDA and net profit were both 2% and 4% higher than expected.
The report said that due to an unexpected increase in the performance of the natural gas sales department, the company's free cash flow increased 17% last year, reaching a record high. The return on free cash flow in 2023 is 16%. The dividend for 2023 was RMB 0.44 per share, in line with expectations, with a dividend ratio of 7.5% for the full year.
Goldman Sachs said that if the oil rating is 80 US dollars per barrel, then CNPC is worth buying for a long time, and the bank's macro team expects this price to continue until 2025. As oil prices continue to hover at $80 per barrel for a long time, Goldman Sachs expects CNPC's cash flow to turn into strong dividends and potential buybacks.