JINJIANG HOTELS(600754) Guotai Junan Securities·2024-10-31 12:27Investment Rating - The report assigns a rating of "Buy" for the company [6]. Core Views - The company's performance fell short of expectations due to demand fluctuations and the recognition of certain one-time expenses. Improvements from organizational and personnel adjustments will require more time to manifest [2][4]. Financial Summary - The company has adjusted its earnings per share (EPS) forecasts for 2024, 2025, and 2026 to 1.09, 1.15, and 1.32 yuan respectively, reflecting decreases of 0.29, 0.25, and 0.26 yuan [4]. - The net profit attributable to the parent company for 2024 is projected to be 7.25 billion yuan, with subsequent years at 10.39 billion and 12.19 billion yuan [4]. - For Q3 2024, the company reported a revenue of 38.98 billion yuan, a decrease of 7.10% year-on-year, and a net profit of 2.58 billion yuan, down 43.08% [4][5]. - The company opened 469 new stores and closed 221, resulting in a net increase of 248 stores in Q3 [4]. Operational Insights - The report highlights that the company's main business has not yet shown signs of improvement, with domestic RevPAR down 8.38% and average daily rate (ADR) down 10.5% in Q3 [4]. - The increase in sales expenses and income tax, along with a decrease in asset disposal gains, contributed to the profit decline [4]. Future Outlook - The company is expected to benefit from a recovery in demand starting in 2025, with operational and performance improvements anticipated [4]. - The target price has been raised to 34.80 yuan, reflecting a price-to-earnings (PE) ratio of 30x for 2025, which is above the industry average [4][6].