Sunner(SZ:002299) Huaxin Securities·2025-05-18 00:45Investment Rating - The report assigns a "Buy" investment rating for the company, marking the first coverage of the stock [5] Core Views - The company is solidifying its breeding advantages while continuously extending its deep processing business [1] - The company's gross margin has improved, with a 1 percentage point increase in 2024 and a 4 percentage point increase in Q1 2025, attributed to product structure optimization [2] - The company has successfully transitioned from low-margin raw meat processing to high-margin deep processing, leading to significant revenue and profit growth [3] Summary by Sections Financial Performance - In 2024, the company reported total revenue of 18.586 billion yuan, a 1% increase year-on-year, and a net profit of 724 million yuan, a 9% increase [1] - For Q1 2025, total revenue was 4.115 billion yuan, a 2% decrease, but net profit improved to 148 million yuan from a loss of 62 million yuan in Q1 2024 [1] Cost and Profitability - The company's net profit margin increased by 0.5 percentage points in 2024 and 5 percentage points in Q1 2025, driven by the optimization of the new self-developed breeding stock "Shengze 901Plus" [2] - The company’s food processing business revenue grew by 10% in 2024, reaching 7.010 billion yuan, as it capitalized on its scale advantages and brand recognition [3] Earnings Forecast - The company is expected to see earnings per share (EPS) of 0.83 yuan in 2025, 1.12 yuan in 2026, and 1.42 yuan in 2027, with corresponding price-to-earnings (P/E) ratios of 19, 14, and 11 times respectively [5] - Revenue growth is projected at 10.2% in 2025, 9.7% in 2026, and 9.1% in 2027, with net profit growth rates of 43.0%, 33.9%, and 27.7% for the same years [7]