Sunner(002299) CAITONG SECURITIES·2024-10-26 05:23Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance relative to the market benchmark [3]. Core Views - The company has shown resilience in its core business with a slight revenue decline of 1.18% year-on-year for the first three quarters of 2024, while net profit decreased by 48.25% [2]. - The company is focusing on cost reduction and efficiency improvements across its operations, which is expected to enhance profitability in the long run [3]. - The company is a leader in the white feather broiler industry, with ongoing improvements in cost structure and genetic advantages, supporting its growth trajectory [3]. Financial Performance Summary - For the first three quarters of 2024, the company achieved revenue of 13.762 billion yuan, down 1.18% year-on-year, and a net profit of 383 million yuan, down 48.25% year-on-year [2]. - The gross margin for the first three quarters was 10.31%, a decrease of 1.29 percentage points year-on-year, while the net margin was 2.67%, down 2.55 percentage points year-on-year [2]. - In Q3 2024, the company reported revenue of 4.925 billion yuan, an increase of 1.62% year-on-year, and a net profit of 281 million yuan, a decrease of 10.38% year-on-year [2]. Business Segment Performance - The poultry breeding and processing segment saw a revenue increase of 5.5% in Q3 2024, with sales volume rising by 21.5% year-on-year [2]. - The deep processing meat products segment reported a revenue of 2.110 billion yuan in Q3 2024, a decrease of 4.1% year-on-year, but with a sales volume increase of 10.4% year-on-year [2]. Capacity and Strategic Developments - The company has ongoing construction projects valued at 751 million yuan, a 56.5% increase from the beginning of the year, primarily due to the expansion of its food processing capacity [3]. - The introduction of a new genetic combination, "Shengze 901plus," has shown significant improvements in feed-to-meat ratios and is gaining market acceptance [3]. Future Projections - The company is projected to achieve revenues of 19.348 billion yuan, 21.266 billion yuan, and 23.081 billion yuan for the years 2024, 2025, and 2026, respectively [3]. - Expected net profits for the same years are 700 million yuan, 1.094 billion yuan, and 1.479 billion yuan, respectively [3]. - The price-to-earnings (PE) ratios based on the closing price on October 25 are projected to be 24.2, 15.4, and 11.4 for 2024, 2025, and 2026, respectively [3].