XUEDA(000526)2024-07-08 04:02Investment Rating - The investment rating for the company is "Outperform the Market" [6][17]. Core Views - The company is expected to achieve a net profit attributable to shareholders of 130-185 million yuan in the first half of 2024, representing a year-on-year increase of 46%-108%, with a midpoint of 158 million yuan (+77%) [2]. - The core business of personalized tutoring for high school students is benefiting from an improved competitive landscape due to policy tightening, and the full-time training base is expected to support operations during the off-season [2]. - The founder of the education business has taken over as chairman, and stock incentives are being steadily implemented, which is expected to enhance management and business team motivation [2]. - The company maintains its earnings forecast for 2024-2025 at 276 million and 362 million yuan, respectively, corresponding to PE valuations of 26x and 20x [2]. Summary by Sections Earnings Forecast - The company forecasts a net profit range of 1.30-1.85 billion yuan for H1 2024, with a midpoint of 1.58 billion yuan, indicating a 77% increase year-on-year [2]. - For Q2 2024, the expected net profit is between 0.80-1.35 billion yuan, with a midpoint of 1.07 billion yuan (+28% year-on-year) [2]. Business Performance - The traditional education training business is benefiting from an improved competitive environment, and the full-time training base is expected to provide complementary support to the core high school tutoring business [2]. - The company is focusing on high school personalized tutoring, which accounted for over 80% of revenue in 2023, indicating strong seasonal performance in Q2 [2]. Management Changes - The founder of the education business, Jin Xin, has been appointed as chairman, which is expected to further focus the company's strategic direction [2]. - The company has granted 1.1 million restricted stock units to 241 eligible incentive targets, with a grant price of 14.05 yuan per share, which will impact short-term operating performance but is expected to enhance team motivation in the medium term [2]. Market Position - The K12 education sector is characterized by strong social demand and a shortage of quality supply, with the company expected to continue benefiting from this trend [2]. - The full-time training base business is seen as a new growth curve that will help smooth out seasonal business operations [2].