JONJEE(SH:600872) Huachuang Securities·2025-10-27 11:14Investment Rating - The report maintains a "Strong Buy" rating for the company with a target price of 23.1 yuan [1]. Core Views - The company continues to face significant pressure, with ongoing adjustments expected. The third quarter of 2025 showed a revenue decline of 22.8% year-on-year, with a net profit drop of 45.7% [1]. - Despite the financial challenges, the company is focusing on proactive adjustments and management reforms to restore its business fundamentals and unlock growth potential [1][5]. Financial Performance Summary - For the first three quarters of 2025, the company achieved a total revenue of 3.16 billion yuan, down 20.0% year-on-year, and a net profit of 380 million yuan, down 34.1% [1]. - The third quarter alone reported revenues of 1.02 billion yuan, a decrease of 22.8% year-on-year, with a net profit of 120 million yuan, reflecting a 45.7% decline [1]. - The overall gross margin improved slightly to 39.5%, up 0.7 percentage points year-on-year, primarily due to lower raw material costs [5]. - The company’s earnings per share (EPS) for 2025 is projected at 0.67 yuan, with estimates for 2026 and 2027 at 0.82 yuan and 0.98 yuan, respectively [1][9]. Revenue and Profitability Trends - Revenue growth rates are projected to be negative for 2025 at -19.7%, with a gradual recovery expected in subsequent years [9]. - The net profit margin for the third quarter of 2025 was recorded at 12.0%, down 5.0 percentage points year-on-year, indicating ongoing profitability challenges [5][6]. Market Position and Strategy - The company is actively working on channel adjustments and inventory management to stabilize market prices and improve sales performance [5]. - The management emphasizes a long-term approach to recovery, focusing on building confidence within the team and maintaining a steady pace of operational improvements [1][5].