WEDGE(SZ:000534) Minsheng Securities·2025-10-27 13:51Investment Rating - The report maintains a "Recommended" rating for the company [4][6]. Core Views - The company achieved a revenue of 941 million yuan in the first three quarters of 2025, representing a year-over-year growth of 21.00%. The net profit attributable to shareholders reached 170 million yuan, up 22.45% year-over-year [1]. - The company's high-temperature alloy division is focused on high-temperature alloy products for aviation engines and is actively expanding its market presence [1]. - The report highlights a significant increase in sales volume of lower-margin high-temperature alloys, which has impacted the overall gross margin [1][2]. Financial Performance - In Q3 2025, the company reported a revenue of 315 million yuan, a year-over-year increase of 14.79%, and a net profit of 51 million yuan, up 23.90% year-over-year [1]. - The gross margin for the first three quarters of 2025 decreased by 3.27 percentage points to 73.61%, while the net margin fell by 1.33 percentage points to 15.98% [1]. - The company has improved its expense management, with a reduction in the overall expense ratio by 3.77 percentage points to 53.13% [2]. Research and Development - The company has increased its R&D expenditure by 21.85% year-over-year, amounting to 136 million yuan, which reflects its commitment to innovation [2]. - The fifth phase of the company's stock incentive plan was announced, aiming to enhance the motivation and creativity of its core team [3]. Future Projections - The company is expected to achieve net profits of 245 million yuan, 353 million yuan, and 447 million yuan for the years 2025, 2026, and 2027, respectively [4][5]. - The current stock price corresponds to a price-to-earnings ratio of 34x for 2025, 24x for 2026, and 19x for 2027 [4][5].