Giant Network(002558) Guohai Securities·2024-10-31 13:45Investment Rating - The report maintains a "Buy" rating for the company [2] Core Views - The company's revenue in Q3 2024 reached 791 million yuan, a year-over-year decrease of 3.94%, but a quarter-over-quarter increase of 8.28%. The net profit attributable to the parent company was 353 million yuan, down 16.18% year-over-year and down 3.34% quarter-over-quarter [3][4] - The gross profit margin for Q3 2024 was 89.81%, an increase of 0.22 percentage points year-over-year [4] - The company is focusing on the performance of its mini-games, particularly the "Wangzhe Zhengtu" and the new version of "Yuanshi Zhengtu," which are expected to drive growth [5][7] Summary by Sections Financial Performance - For Q1-Q3 2024, the company achieved a total revenue of 2.218 billion yuan, a year-over-year decrease of 2.15%. The net profit attributable to the parent company was 1.071 billion yuan, a decrease of 1.29% year-over-year [4] - The company’s operating expenses for Q3 2024 were 2.79 million yuan for sales, 0.50 million yuan for management, and 1.89 million yuan for R&D, with year-over-year increases of 21.99%, 40.36%, and 3.34% respectively [4] Market Position - The company’s stock has performed well relative to the CSI 300 index, with a 1-month performance of 7.5%, 3-month performance of 45.6%, and a 12-month performance of 12.1% [4] - The "Wangzhe Zhengtu" mini-game ranked in the top 10 of the mini-game sales charts for July, August, and September 2024, indicating strong market traction [5] Future Projections - Revenue projections for 2024-2026 are 3.293 billion yuan, 3.639 billion yuan, and 3.926 billion yuan respectively, with net profits projected at 1.456 billion yuan, 1.654 billion yuan, and 1.814 billion yuan [7][8] - The expected EPS for 2024, 2025, and 2026 is 0.75 yuan, 0.86 yuan, and 0.94 yuan respectively, with corresponding P/E ratios of 16.88, 14.85, and 13.54 [8]