WH Group Limited: Decent yield support despite near-term EPS downside

We lower 2026/27E EPS 8%/11%, mainly to reflect the softness of US hog and pork prices, amid Smithfield's recent guidance cut (2nd time since Aug) and our US analyst's EPS revisions of Smithfield. We forecast EPS declines through 1Q27, before potential stabilization from 2Q27 due to an easy base in both China and the US then. We also lower our PO 11% to HK$8.5. We reiterate our Buy rating, as the market in general regards WH as a yield stock. WH now offers an attractive dividend yield of ~8%, even if we have factored in a very prudent DPS estimate in our updated forecast. We forecast OP to be -31% in 3Q26 (China -14% in RMB terms but -8% in US$ terms on FX; the US -53%; Europe -33%), but NPAT to be -38%. China is set to see an earnings recovery in 4Q26. WH's dividend policy is a payout ratio of at least 50%; we forecast 2026 regular DPS of HK$0.51 (vs HK$0.61 in 2025), implying a 60% payout ratio.