YUYUE MEDICAL(002223) SINOLINK SECURITIES·2024-10-26 13:00Investment Rating - The report maintains a "Buy" rating for Yuyue Medical (002223.SZ) [2] Core Views - The company's revenue returned to positive growth in Q3 2024, with a significant increase in marketing investment [2] - The diabetes care segment is accelerating, with steady progress in CGM product development [2] Summary by Sections Performance Overview - In the first three quarters of 2024, the company achieved revenue of 6.028 billion yuan, down 10% year-on-year; net profit attributable to shareholders was 1.532 billion yuan, down 30% year-on-year; and non-recurring net profit was 1.274 billion yuan, down 24% year-on-year [2] - In Q3 2024, revenue reached 1.720 billion yuan, up 2% year-on-year; net profit attributable to shareholders was 411 million yuan, down 41% year-on-year; and non-recurring net profit was 310 million yuan, down 25% year-on-year [2] Operational Analysis - The company saw a return to positive revenue growth in Q3, with expectations that respiratory therapy, blood glucose management, and home medical devices have returned to normal operating conditions [2] - Sales expenses in Q3 were 317 million yuan, up 30.5% year-on-year, with a sales expense ratio of 18.4%, up 4.0 percentage points year-on-year, indicating increased investment in brand and new product promotion [2] Marketing Strategy - The company has established a professional marketing system with over 1,000 personnel in channels, online terminals, and foreign sales teams, enhancing its direct sales capabilities [2] - The online sales and marketing efforts are leading in the industry, with flagship stores on major e-commerce platforms [2] Diabetes Care Segment - The diabetes care solutions business is making breakthroughs, with market share for BGM-related products continuing to rise and customer base expanding [2] - The CGM products have seen rapid sales growth since their domestic launch, with ongoing development of next-generation products [2] Profit Forecast and Valuation - The company is expected to achieve net profits of 2.004 billion yuan, 2.316 billion yuan, and 2.723 billion yuan for 2024-2026, with year-on-year changes of -16%, +16%, and +18% respectively [2] - The current price corresponds to a PE ratio of 17, 15, and 13 times for 2024, 2025, and 2026 respectively, maintaining a "Buy" rating [2]