March 20, 2025 06:08 AM GMT Geely Automobile Holdings | Asia Pacific 4Q in line - Higher GPM and disposal gain offset higher opex Reaction to earnings Unchanged In-line Largely unchanged Impact to our thesis Financial results versus consensus Direction of next 12-month consensus EPS Source: Company data, Morgan Stanley Research Geely reported 4Q24 earnings of Rmb3.6bn, growing 36% QoQ and 45% YoY, in line with our expectations, where higher GPM and a one-off disposal gain of Rmb1.6bn offset higher opex. Ful ...

Core Viewpoint - The article emphasizes the importance of timing and sustainability in stock trends for successful short-term investing, highlighting that sound fundamentals and positive earnings revisions are crucial for maintaining momentum in stock prices [1][2]. Group 1: Stock Performance - Geely Automobile Holdings Ltd. (GELYY) has shown a solid price increase of 25.2% over the past 12 weeks, indicating strong investor interest [4]. - The stock has also increased by 20.5% over the last four weeks, suggesting that the upward trend is still intact [5]. - Currently, GELYY is trading at 94.6% of its 52-week high-low range, indicating a potential breakout [5]. Group 2: Fundamental Strength - GELYY holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. Group 3: Investment Strategy - The "Recent Price Strength" screen is a useful tool for identifying stocks like GELYY that are on an uptrend supported by strong fundamentals [3]. - The article suggests that investors should consider other stocks that meet similar criteria and explore various Zacks Premium Screens tailored to different investing styles [8].

Summary of Geely Automobile Conference Call Company Overview - Geely Automobile has completed self-research on the three core components of vehicles, leading to sales growth driven by sedan models (Yuanjing, Emgrand) and SUVs (Boyue) [2][3] - The company is transitioning towards high-end markets through acquisitions (e.g., Volvo) and joint ventures (e.g., Lynk & Co), which has positively impacted sales and stock prices [2][3] Industry and Market Position - Geely Holdings Group encompasses multiple passenger car brands including Geely Automobile, Volvo, smart, and Proton, as well as commercial vehicle brands [2][6] - The company has established a full industry chain layout with subsidiaries listed in Hong Kong, including Geely Galaxy New Energy, Zeekr, Lynk & Co, and joint ventures with Renault [2][6] Key Developments and Strategies - Geely has shifted from a three-stage hybrid development to a single-stage hybrid, significantly enhancing the range of its vehicles [4] - The company has launched the Taizhou Declaration to integrate teams and adjust equity structures, strengthening collaboration in electrification and intelligence [2][5][8] - The "Geely 4.0" era is marked by strategic adjustments to promote electric and intelligent vehicle development [8][9] Financial Performance and Projections - In 2023, Geely's sales entered an upward trajectory, with significant year-on-year growth expected in 2024 [10] - The company anticipates a net profit of 10.037 billion RMB in 2025, increasing to 18 billion RMB by 2026, with a sales target of 2.17 million units in 2024 and 2.7 million in 2025 [21] Brand Performance - Geely Galaxy focuses on plug-in hybrid and pure electric vehicles, competing with BYD, and has seen strong sales performance [12] - The Zeekr brand has established a presence in the high-end electric vehicle market, with sales increasing from 70,000 units in 2022 to over 200,000 units in 2024 [13] - Lynk & Co is transitioning from a mid-to-high-end fuel vehicle brand to a mid-to-high-end new energy brand, facing short-term sales pressure but expected recovery [14] Technological Advancements - Geely has developed two main vehicle platforms: SEA and GEE, covering various energy types and enhancing cost-effectiveness [15] - The company has made significant improvements in hybrid technology, including the introduction of silicon carbide modules and optimized control technologies [17] - In the field of intelligent driving, Geely covers high, medium, and low-level solutions, emphasizing a fully self-developed system [18] AI and Smart Features - Geely is advancing in AI with the development of new AI models and collaborations with leading tech companies [20] - The company employs a dual strategy for smart cockpits, integrating self-developed operating systems with existing technologies [19] Investment Recommendation - Investment in Geely is recommended due to its strategic positioning in the vehicle model cycle, advancements in smart technology, and potential for significant changes in the AI landscape [22]

Summary of Conference Call on Automotive Industry Industry Overview - The automotive industry is experiencing strong sales, particularly in January, with expectations for continued robust performance through 2025 [1][3] - The rise of smart driving technology is a significant trend, with companies focusing on smartization as a key growth area [1][4] Key Companies Discussed - **Geely**: Recognized for its strong sales growth and ability to follow industry trends rather than lead [2][4] - **Diadi, GD, Xiaopeng**: Recommended for their strong career cycles and sales potential [1][2] - **Geek Technology Group**: Seen as undervalued with significant potential in smart driving and brand integration [12][13] Sales Projections - Geely aims for sales of 2.7 million units in 2025, a significant increase from 2.1 million in 2014 [3][4] - Galaxy brand expected to launch five new products in 2025, contributing to sales growth [4][5] - Total sales for Geely and its brands projected to reach nearly 700,000 units in 2025 and exceed 1 million in 2026 [19][20] Profitability Insights - Geely's single-vehicle profit is expected to improve significantly, with a projected profit of 1.3 billion yuan in 2025 and 1.6 billion yuan in 2026 [12][21] - Cost reductions anticipated in R&D and production, with BOM costs expected to decrease by 5% to 8% [20][21] Technological Advancements - Geely's new EMI mixing system has received positive user feedback, indicating improvements in flexibility and power [5][6] - Integration of smart driving technology is crucial, with plans for rapid follow-up on successful models [9][10][22] Brand Integration and Strategy - The merger of Link and Geek brands aims to streamline operations and reduce costs, enhancing overall profitability [11][15] - The focus on SUV models is a strategic move, with significant new launches planned for 2025 [18][19] Market Position and Valuation - Current valuation of Geely is approximately 12 times earnings, considered acceptable given growth prospects [12][24] - Anticipated market value of 2.3 trillion RMB, with a focus on maintaining competitive pricing and sales volume [24] Conclusion - The automotive industry, particularly Geely and its associated brands, is positioned for strong growth driven by technological advancements and strategic brand integration. The focus on smart driving and cost efficiency will be critical for maintaining profitability and market competitiveness in the coming years [1][12][24]

Core Viewpoint - The article emphasizes the importance of identifying and sustaining stock price trends for successful short-term investing, highlighting Geely Automobile Holdings Ltd. (GELYY) as a strong candidate for trend investors due to its recent price performance and positive fundamentals [1][4][6]. Group 1: Price Performance - GELYY has experienced a solid price increase of 14.9% over the past 12 weeks, indicating strong investor interest [4]. - The stock has also seen a price increase of 14.8% over the last four weeks, confirming that the upward trend is still intact [5]. - Currently, GELYY is trading at 97.6% of its 52-week high-low range, suggesting it may be on the verge of a breakout [5]. Group 2: Fundamental Strength - GELYY holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. Group 3: Investment Strategy - The article suggests that investors can utilize the "Recent Price Strength" screen to identify stocks like GELYY that are on an uptrend supported by strong fundamentals [3][8]. - It also mentions that there are over 45 Zacks Premium Screens available for investors to find potential winning stock picks based on their personal investing styles [8].

Summary of Conference Call Notes Company and Industry - The discussion revolves around the automotive industry, specifically focusing on the Lynk & Co 900 model, which is positioned as a significant product among traditional car manufacturers [1][2]. Core Insights and Arguments 1. **Product Positioning and Characteristics** - The Lynk & Co 900 is described as a phenomenon in the traditional automotive sector, particularly in the large six-seat SUV category, with a length of 5.24 meters and a wheelbase of 3.16 meters, making it competitive among domestic brands [1][2]. - It is noted for its innovative features and strong product capabilities, setting it apart from competitors like the L9 from Li Auto [1][2]. 2. **Key Highlights of the Lynk & Co 900** - **Interior Space**: The vehicle features a unique interior space design, including movable second and third-row seats, which can slide forward and backward, providing flexibility not commonly found in other SUVs [3][4]. - **Smart Cockpit**: The smart cockpit includes a dual-screen setup allowing for multitasking, such as watching movies or using apps independently by passengers [8][9]. - **Comfort and Luxury**: The interior is highlighted for its high-quality materials and luxurious feel, potentially surpassing competitors in terms of interior quality [10][11]. - **Chassis and Powertrain**: The vehicle utilizes the SBA EVO architecture, designed for larger vehicles, and features a combination of a 2.0T and a 1.5T engine, with a strong emphasis on performance and handling [12][13][14]. - **Safety Features**: Enhanced safety measures are implemented, particularly for the third row, which is noted to have superior safety features compared to competitors [17]. 3. **Pricing and Sales Expectations** - The expected pricing for the Lynk & Co 900 is estimated to be around 400,000 RMB, potentially making it more affordable than the N9 model [18]. - Projected monthly sales are estimated to be between 5,000 to 10,000 units, indicating strong market potential [18]. 4. **Impact on the Industry** - The introduction of the Lynk & Co 900 is expected to significantly influence the competitive landscape, particularly against brands like BYD, which is also focusing on high-end vehicles [19]. Other Important but Possibly Overlooked Content - The design of the vehicle includes a unique "heavenly door" for the trunk, which allows for easier access in tight parking spaces [6]. - The second-row seats can rotate 180 degrees, catering to family-oriented use cases, which is a first in the SUV segment [5]. - The vehicle's architecture allows for high space utilization, contributing to its overall performance and comfort [13][14]. - The discussion emphasizes the importance of the vehicle's design and technology in enhancing user experience and safety, which may not be immediately apparent in traditional automotive evaluations [16].

Summary of the Conference Call on 2025 Sales Targets for Geely Automobile Company Overview - **Company**: Geely Automobile - **Industry**: Automotive, specifically focusing on traditional fuel vehicles and new energy vehicles (NEVs) Key Points and Arguments Sales Performance and Targets - In 2024, Geely achieved a record sales volume of over 2.17 million units, exceeding the target of 2 million units by 9%, with a year-on-year growth of 32% [1][20] - The sales target for 2025 is set at 2.71 million units, which includes an export target of 467,000 units, reflecting a growth rate of over 15% [7][22] - The company aims for NEV sales to reach 1.5 million units in 2025, a 69% increase from 2024, with a penetration rate exceeding 55% [5][22] Brand Performance - Geely brand sales in 2024 reached 1.669 million units, a 27% increase, with the new high-end series contributing 448,000 units [2] - The Geely Galaxy series and the Geely New Energy vehicles have shown significant market performance, with the Galaxy New Energy vehicle achieving over 50,000 deliveries in just 80 days [3][23] - The Geely brand is positioned as a leader in the domestic NEV market, with a notable increase in overseas sales, which reached 404,000 units, a 53% increase year-on-year [2] Market Trends and Strategic Focus - The automotive market is expected to maintain steady growth, with structural changes becoming more pronounced, particularly in the NEV segment [4] - Geely is focusing on enhancing its international presence and brand recognition, with plans to accelerate overseas production and sales [4][36] - The company is committed to addressing macroeconomic trends and potential risks associated with global market uncertainties [4] Profitability and Financial Goals - A key goal for 2025 is for the NEV segment to achieve profitability, building on a significant turnaround in the third quarter of 2024 [8] - The management emphasizes that achieving profitability is crucial for sustainable growth and shareholder returns [8][41] ESG and Corporate Responsibility - Geely has been recognized for its ESG performance, ranking first in the Chinese automotive industry, and plans to enhance its ESG initiatives further [9] - The company is committed to maintaining product quality and social responsibility amidst fierce market competition [9] Product Development and Innovation - Geely plans to launch several new models in 2025, including four to five new energy vehicles, to fill gaps in its product lineup [24][27] - The company is investing in smart technology and AI integration to enhance vehicle performance and user experience [32][33] Challenges and Competitive Landscape - The automotive industry is facing challenges such as increased competition and technological changes, but Geely remains confident in its product competitiveness [4][40] - The company aims to avoid price wars and instead focus on value and technological superiority to maintain market competitiveness [39] Additional Important Content - Geely's inventory levels are at historical lows, allowing for a more confident approach to meeting 2025 targets [7] - The company is actively working on integrating its brands and optimizing its operational efficiency to enhance overall performance [10][19] - The management team expresses strong confidence in achieving the set targets for 2025, emphasizing a dual focus on sales and profitability [41]

Core Viewpoint - The article emphasizes the importance of value investing and highlights Geely Automobile (GELYY) as a strong candidate for value investors due to its favorable financial metrics and strong earnings outlook [1][2][6]. Company Summary - Geely Automobile (GELYY) currently holds a Zacks Rank of 1 (Strong Buy) and a Value grade of A, indicating strong potential for value investors [4]. - The stock has a P/E ratio of 8.26, which is lower than the industry average P/E of 8.87, suggesting it may be undervalued [4]. - Over the past 12 months, GELYY's Forward P/E has fluctuated between a high of 17.07 and a low of 6.71, with a median of 11.13, indicating variability in market perception [4]. - The P/B ratio for GELYY is 0.87, which is also lower than the industry average P/B of 0.95, further supporting the notion of undervaluation [5]. - GELYY's P/B has ranged from a high of 1.17 to a low of 0.82 over the past year, with a median of 0.98, reflecting its market value relative to book value [5]. - Overall, the financial metrics suggest that Geely Automobile is likely undervalued, making it an attractive option for value investors [6].

Summary of Conference Call Records Company and Industry Overview - The conference call discusses the automotive industry, specifically focusing on the company Geely and its product strategies, including new vehicle launches and market positioning. Key Points and Arguments 1. Geely is experiencing its strongest new product cycle, with a comprehensive strategy targeting price ranges from 100,000 to 500,000 RMB, aiming to compete with brands like BRD [1] 2. The Galaxy brand is introducing new models based on the GA architecture, featuring the new generation of powertrains, emphasizing large space, low fuel consumption, and high cost-performance ratio [1] 3. The Galaxy L6 and L7 models have seen significant improvements in fuel efficiency, with L7's consumption decreasing from 5.23 L/100km last year to 4.9 L/100km this year, and L6's from 4.55 L/100km to 3.95 L/100km, representing a reduction of over 10% [3] 4. The Galaxy E8 will be updated next year to include a hybrid version alongside its existing electric variant, targeting competition with BYD's Han series, which has a combined sales volume of approximately 20,000 to 30,000 units [2] 5. The upcoming EX11 and DX11 SUVs are expected to be priced around 400,000 RMB and 300,000 RMB respectively, both featuring hybrid versions and advanced self-driving capabilities [4] 6. The Lynk & Co brand is set to launch the L946, a large 6-seater vehicle priced between 300,000 to 400,000 RMB, built on the new SPA 2.0 architecture, which offers improved space utilization compared to previous models [5][6] 7. The L946 may feature a 50 kWh battery and a tri-motor system for rear-wheel steering, enhancing its performance and appeal in the market [6] Additional Important Information - The conference highlights the competitive landscape in the automotive sector, with Geely's strategic focus on high-end models and hybrid technologies to capture market share against established competitors [5] - The emphasis on fuel efficiency and cost-effectiveness in new models indicates a response to consumer demand for sustainable and economical vehicles [3] - The introduction of multiple new models across different price segments suggests a comprehensive approach to market penetration and brand diversification [1][4]

Core Viewpoint - Geely Automobile Holdings Ltd. has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][4]. Earnings Estimates - The Zacks Consensus Estimate for Geely Automobile for the fiscal year ending December 2024 is projected at $4.45 per share, reflecting a 209% increase from the previous year's reported figure [9]. - Over the past three months, the Zacks Consensus Estimate for Geely has risen by 103.9%, indicating a strong upward trend in earnings estimates [9]. Zacks Rating System - The Zacks rating system is based solely on a company's changing earnings picture, which is tracked through EPS estimates from sell-side analysts [2]. - The system classifies stocks into five groups, with Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell), and has shown a strong track record, with Zacks Rank 1 stocks averaging a +25% annual return since 1988 [8]. Market Implications - The upgrade to Zacks Rank 2 places Geely in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [12][11]. - Rising earnings estimates are correlated with stock price movements, as institutional investors often adjust their valuations based on these estimates, leading to buying or selling pressure [5][6].