GONGNIU(SH:603195) Guoxin Securities·2024-11-07 00:44Investment Rating - The investment rating for the company is "Outperform the Market" [6][4]. Core Views - The company demonstrated resilient operations with steady revenue and profit growth in Q3 2024, achieving a revenue of 12.6 billion (+8.6%) and a net profit of 3.26 billion (+16.0%) for the first three quarters [1]. - The revenue for Q3 2024 was 4.22 billion (+5.0%), with a net profit of 1.02 billion (+3.4%), indicating a slight decline in profitability due to external consumption environment and real estate pressures [1][2]. - The company is focusing on solidifying its core business while rapidly growing new business segments, particularly in electric connection and smart electrical lighting [2]. Financial Performance Summary - For Q3 2024, the gross margin was 43.5%, down by 1.2 percentage points, primarily due to rising raw material costs [3]. - The net profit margin for Q3 2024 was 24.3%, a decrease of 0.4 percentage points, with non-operating income contributing approximately 89 million [3]. - The company has adjusted its profit forecasts for 2024-2026, expecting net profits of 4.31 billion, 4.65 billion, and 5.15 billion respectively, reflecting year-on-year growth of 11%, 8%, and 11% [4][5]. Business Segments and Growth - The electric connection business is expected to maintain steady growth driven by consumer trends and diverse electrical usage scenarios [2]. - The new energy business is projected to continue its rapid growth, with over 22,000 C-end terminal points developed by mid-2024 [2]. - The company is enhancing its product structure and expanding into new product lines such as electric tools, which are anticipated to become new growth drivers [2]. Valuation Metrics - The current stock price is 74.09 yuan, with a market capitalization of 95.76 billion yuan [6]. - The expected earnings per share (EPS) for 2024-2026 are projected to be 4.83, 5.21, and 5.78 yuan, with corresponding price-to-earnings (PE) ratios of 15.3, 14.2, and 12.8 [4][5].