Focus Media(SZ:002027) GF SECURITIES·2026-01-25 10:08Investment Rating - The investment rating for the company is "Buy" with a current price of 7.44 CNY and a reasonable value of 9.45 CNY [2][9]. Core Views - The report emphasizes that the one-time impact from the impairment of the joint venture, Shuhe, does not alter the company's operational trends and high shareholder return plans. The adjustment is considered a one-time effect, and the company has exited from Shuhe, which will no longer affect its performance. The main business remains strong, with increased advertising investments from internet advertisers and upcoming major events boosting advertising spending [9][10][11]. Summary by Relevant Sections Financial Forecasts - The company is expected to achieve overall revenues of 127.51 billion CNY, 136.72 billion CNY, and 145.55 billion CNY for the years 2025 to 2027, with year-on-year growth rates of 4.0%, 7.2%, and 6.5% respectively. The net profit attributable to shareholders is projected to be 31.84 billion CNY, 60.22 billion CNY, and 60.83 billion CNY for the same period, with EPS of 0.22 CNY, 0.42 CNY, and 0.42 CNY [9][11][12]. Revenue Breakdown - The revenue from the building media segment is expected to be 120.32 billion CNY, 129.17 billion CNY, and 137.85 billion CNY from 2025 to 2027, with corresponding growth rates of 4.2%, 7.4%, and 6.7%. The cinema media segment is projected to generate revenues of 6.95 billion CNY, 7.30 billion CNY, and 7.45 billion CNY during the same period [10][11]. Valuation - The report suggests a valuation based on a 25x PE ratio for 2026, resulting in a total reasonable value of 1,364 billion CNY and a reasonable share price of 9.45 CNY. This valuation considers the positive competitive landscape post-acquisition of Xinchao and the potential for effective advertising through the "Touch" initiative [9][13][14].