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Stay prudent as channel health is the priority
Zhao Yin Guo Ji· 2024-03-18 16:00
M N 19 Mar 2024 CMB International Global Markets | Equity Research | Company Update Xtep (1368 HK) Stay prudent as channel health is the priority Target Price HK$6.31 Xtep’s FY23 results were dragged by weak e-commerce sales but inline with market consensus. Due to the macro uncertainty and high base, Xtep’s (Previous TP HK$7.07) management has put aside its 5-year growth target and introduced a rather Up/Downside 39.0% conservative target in FY24E. This is inline with our view that Xtep may not be Current ...
Riding on stepping-up of expansion
Zhao Yin Guo Ji· 2024-03-18 16:00
M N 19 Mar 2024 CMB International Global Markets | Equity Research | Company Update GigaCloud (GCT US) Riding on stepping-up of expansion Target Price US$43.0 GigaCloud (GCT) 4Q23 results beat already-high expectation, with revenue (Previous TP US$30.0) /earnings +95%/185% YoY (beating 9%/43%). Coupled with robust 1Q24E Up/Downside 25.7% guidance, we see high visibility for its strong performance in next few quarters, Current Price US$34.2 backed by continuous share gain and SKU& Sellers expansion. Leveragi ...
FY23 VNB +33% in line; strong MCV momentum sustained to 1-2M24
Zhao Yin Guo Ji· 2024-03-17 16:00
CMB International Global Markets | Equity Research | Company Update PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE MORE REPORTS FROM BLOOMBERG: RESP CMBR OR http://www.cmbi.com.hk1 Error! Reference source not found. Rerating rationale Total value = Embedded Value + Value of New Business * New Business Multiplier Long-term RoEV from 14% to 11%: Aside from the operating RoEV, we also include other metrics, i.e. investment experience variances, effect of changes in economic assum ...
Weathering a challenging FY24
Zhao Yin Guo Ji· 2024-03-17 16:00
Investment Rating - The report maintains a BUY rating for Weibo, indicating a potential return of over 15% over the next 12 months [2][13]. Core Insights - Weibo's total revenue for 4Q23 grew by 3% YoY to US$464 million, slightly above estimates, while FY23 revenue declined by 4% YoY to US$1.76 billion [2]. - Non-GAAP operating income for 4Q23 decreased by 4% YoY to US$146 million, but was 7% ahead of consensus due to stringent control over product development expenses [2]. - The company plans to increase investment in content and user acquisition to drive top-line growth in 2024, with expected revenue flat YoY at US$1.77 billion [2]. - The target price has been lowered to US$18.80 from US$23.50, reflecting a discount to peers' average valuation [2]. Revenue and Profitability - For FY24, total revenue is projected at US$1.77 billion, with adjusted net profit forecasted at US$451 million, down 16-19% from previous estimates [2][7]. - The adjusted net profit margin is expected to decline to 25.5% in FY24E, reflecting increased investments [2][11]. - Advertising revenue in 4Q23 grew by 3% YoY to US$404 million, with specific verticals like automobiles and online games showing strong performance [2]. User Engagement and Community Development - Monthly Active Users (MAUs) increased by 2% YoY to 598 million as of December 2023 [2]. - Weibo is focusing on enhancing user stickiness through investments in key content verticals and optimizing social products [2]. Shareholder Returns - Weibo announced a special cash dividend of US$0.82 per share, translating to an approximate 8% dividend yield, aimed at supporting valuation recovery [2].
Solid FY23 with better profitability
Zhao Yin Guo Ji· 2024-03-17 16:00
M N 18 Mar 2024 CMB International Global Markets | Equity Research | Company Update Tuhu Car (9690 HK) Solid FY23 with better profitability Target Price HK$35.3 Tuhu Car (Tuhu) achieved decent profit for the first time in FY23, with revenue (Previous TP HK$50.10) +18% YoY (in line) and adj. NP at RMB481mn (27% above consensus). Looking Up/Downside 195.2% into FY24E, we are positive on its resilient growth (forecasting revenue + 16% Current Price HK$11.96 YoY), backed by workshop expansion, richer offerings, ...
FY23 results beat helped by better 4Q
Zhao Yin Guo Ji· 2024-03-17 16:00
M N 18 Mar 2024 CMB International Global Markets | Equity Research | Company Update Shennan Circuit (002916 CH) FY23 results beat helped by better 4Q Q Shennan Circuit released its FY23 earnings, with revenue down 3.3% YoY to Target Price RMB79.00 RMB13.5bn (5%/2% higher than our forecast/consensus) and net profit down (Previous TP RMB72.00) 14.8% YoY to RMB1.4bn (11%/5% higher than our forecast/consensus). The Up/Downside -11.2% Company beat estimates thanks to a stronger-than-expected 4Q. The Current Pric ...
Focusing on margin enhancement
Zhao Yin Guo Ji· 2024-03-17 16:00
Investment Rating - The report maintains a "BUY" rating for Mobvista Inc. with a target price of HK$6.00, indicating an upside potential of 85.8% from the current price of HK$3.23 [5][15]. Core Insights - Mobvista's FY23 results were largely in line with expectations, showing a revenue increase of 18% year-over-year (YoY) and an adjusted net profit of US$19.1 million, which is 9% above consensus estimates [2][3]. - The company is expected to enhance profitability significantly in FY24, with a forecasted bottom line of US$37 million and a net margin of 2.9%, alongside solid revenue growth of 20% YoY [2][3]. - The report highlights the resilience of the Mintegral revenue, which grew by 19.5% YoY in Q4 2023, and anticipates continued momentum in midcore and hardcore games [2][3]. Revenue and Profitability - Mobvista's revenue for FY23 reached US$1,054 million, with a gross profit margin (GPM) improvement to 20.6%, up 0.8 percentage points YoY, driven by higher advertising efficiency and cost discipline [3][17]. - The company reported a significant increase in adjusted net profit, which rose by 97% YoY, reflecting strong operational performance [3][17]. - By segment, ad-tech and mar-tech revenues grew by 17.8% and 23.9% YoY, respectively, indicating robust growth across its business lines [3][17]. Future Outlook - For FY24, Mobvista is projected to achieve revenue of US$1,265 million, with continued growth expected in the lifestyle segment, which saw a remarkable 143% YoY increase in revenue [3][12]. - The intelligent bidding system upgrade is anticipated to facilitate category expansion, particularly in non-gaming sectors such as e-commerce [2][3]. - The adjusted net margin is expected to improve to 2.9% in FY24 and 3.0% in FY25, reflecting a positive long-term margin outlook [3][12]. Valuation Metrics - The report employs a sum-of-the-parts (SOTP) valuation method, applying a 20x FY24E P/E for the ad-tech business and a 3x FY24E P/S for the mar-tech business, resulting in a target price of HK$6.00 [2][14]. - The projected earnings compound annual growth rate (CAGR) for FY24-26 is estimated at 21%, indicating strong growth potential compared to industry peers [2][14].
美国经济:零售温和放缓,商品通胀反弹
Zhao Yin Guo Ji· 2024-03-14 16:00
2024 年 3 月 15 日 招银国际环球市场 | 宏观研究 | 宏观视角 零售温和放缓,商品通胀反弹 叶丙南, Ph.D (852) 3761 8967 yebingnan@cmbi.com.hk 1 | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |--------------------------------------|------------------|-------------------|-----------------|-----------------|----------------|---------------------------------------------------------|-------------------|-------------|-----------| | 总计 | 占比 (%) \n100.0 | 2022 年月均 \n0.5 | 1Q23 月均 \n0.6 | 2Q23 月均 \n0.4 | 3Q23月均 \n0.7 | 零售和食品服务销售额(季调月环比,%) 4Q ...
“流媒体+体育”风起时
Zhao Yin Guo Ji· 2024-03-13 16:00
Investment Rating - The report assigns a "Buy" rating to Walt Disney Company (DIS US) with a target price of $142, representing a 26.4% potential upside from the current price of $112.3 [1][2] Core Views - Disney is expected to benefit from the growth of streaming and sports sectors, driven by its extensive content ecosystem, iconic IPs, and diversified product portfolio [1] - The company's streaming losses narrowed better than expected in 1QFY24, and management expects streaming to achieve profitability by 4QFY24 [1] - Disney is projected to achieve a 5% revenue CAGR and 16% profit CAGR from FY24 to FY26, supported by advertising-tier membership penetration, shared subscription plans, Hulu synergies, and resilient theme park growth [1] - The sports business, particularly ESPN+, is seen as a long-term growth engine, with potential from strategic partnerships and standalone app launches [1] Business Segments Streaming (DTC) - Disney+ reached 150 million paid subscribers in 1QFY24, with a projected 4% CAGR in subscriber growth from FY24 to FY26 [1] - The streaming business is expected to achieve breakeven in 4QFY24 and deliver double-digit operating margins in the long term [1] - Key growth drivers include rich content library, advertising-tier memberships, shared subscriptions, and Hulu synergies [1] Theme Parks - Theme parks remain a cash cow for Disney, contributing approximately 2/3 of the group's operating profit in FY24 [1] - International parks are expected to maintain steady growth, while US parks are projected to accelerate revenue growth in 2H24 [1] - The segment is forecasted to deliver a 10% operating profit CAGR from FY24 to FY26 [1] Sports (ESPN+) - ESPN+ is positioned to capture growth in the digital sports market, leveraging rising streaming penetration and strong demand from sports enthusiasts [1] - Strategic partnerships and standalone app initiatives are expected to drive long-term growth in this segment [1] Financial Projections - FY24 revenue is projected at $91.8 billion, with a 3.3% YoY growth, while adjusted net profit is expected to reach $8.5 billion, a 23.9% YoY increase [5] - FY24 EPS is forecasted at $4.62, representing a 23.4% YoY growth [5] - Free cash flow is expected to reach $8 billion in FY24 [1] - The company's long-term operating margin for theme parks is projected to exceed 25% [1] Valuation - The SOTP-based target price of $142 implies a FY24 P/E of 30.7x, which is 14% lower than Netflix's valuation but slightly above the industry average [1][7] - Key valuation catalysts include streaming profitability, content-driven subscriber growth, resilient theme park performance, and sports business potential [1][6] Peer Comparison - Disney's FY24E P/E of 23.8x is lower than Netflix's 35.5x but higher than Comcast's 10.2x [11] - The company's FY24-26 EPS CAGR of 16% is higher than the industry average of 17% [11]
FY23 in line; upbeat FY24E outlook on AI server/networking, EV and AirPods upside
Zhao Yin Guo Ji· 2024-03-13 16:00
Investment Rating - The report maintains a "BUY" rating for FIT Hon Teng with a new target price of HK$2.21, representing a 64.7% upside from the current price of HK$1.34 [4][15]. Core Insights - FIT Hon Teng's FY23 results were in line with expectations, reporting revenue of US$4,196 million, a decrease of 7% year-on-year, and a net profit of US$130 million, down 24% year-on-year. The decline was attributed to softer demand in traditional servers and PCs, while the EV segment saw a significant increase of 100% year-on-year due to the Voltaira merger [2][3]. - The management provided an optimistic outlook for FY24E, forecasting double-digit year-on-year growth in both revenue and gross profit, driven by new product launches and synergies from the Voltaira auto electronics business. Revenue and net profit are expected to rebound by 12.2% and 41.6% year-on-year, respectively [2][10]. Financial Performance Summary - FY23 revenue was US$4,196 million, with a gross margin of 19.2%, an improvement from 16.9% in FY22, due to a better product mix and effective execution of the "3+3 Strategy" [2][19]. - The company expects revenue for FY24E to reach US$4,706 million, with a gross profit of US$931 million, reflecting a gross margin of 19.8% [10][19]. - The net profit for FY24E is projected at US$183 million, with an EPS of 2.58 US cents, indicating a significant recovery from FY23 [11][19]. Growth Drivers - Key growth drivers include the integration of Voltaira's auto business, advancements in AI server and networking products, and increased orders for AirPods expected in Q3 2024 from major US customers [2][10]. - The report highlights the attractive valuation of FIT Hon Teng, trading at 6.6x FY24E P/E, which is considered favorable given the anticipated earnings visibility and growth potential [2][15]. Market Position - FIT Hon Teng's market capitalization is approximately HK$9,737.8 million, with a shareholding structure dominated by Foxconn Far East Ltd, holding 71.1% [5][16]. - The stock has shown strong performance, with a 1-month increase of 38.1% and a 3-month increase of 27.6% [5].