GoerTek(SZ:002241) Minsheng Securities·2024-03-27 16:00Investment Rating - The report maintains a "Recommended" rating for the company [2][3]. Core Views - The company's performance in 2023 met expectations, with a revenue of 98.57 billion yuan, down 6.0% year-on-year, and a net profit attributable to shareholders of 1.09 billion yuan, down 37.8% year-on-year. The decline in revenue is attributed to weak global economic recovery, interest rate hikes in major economies, and insufficient demand in the consumer electronics sector [2][3]. - The company is expected to see gradual recovery in performance and profits, with projected net profits of 2.03 billion yuan, 3.23 billion yuan, and 4.50 billion yuan for 2024, 2025, and 2026 respectively, corresponding to PE ratios of 27, 17, and 12 [2][3]. - The XR industry is at a low point, but new products are anticipated to drive recovery. The company’s major client, Meta, is expected to release a budget version of Quest in 2024, which could boost revenue and profits in the smart hardware segment [2][3]. - The company has shown confidence in its long-term development by initiating a share buyback plan totaling 500 to 700 million yuan, with 597 million yuan already repurchased as of February 29 [2][3]. Financial Summary - In 2023, the company achieved total revenue of 98.57 billion yuan, with a net profit of 1.09 billion yuan. The gross margin for 2023 was 8.95%, a decrease of 2.2 percentage points year-on-year. However, in Q4 2023, the gross margin improved to 10.6%, up 4.3 percentage points year-on-year [2][3][5]. - The company’s operating cash flow for 2023 was 8.15 billion yuan, indicating healthy cash flow management [2][3][7]. - The projected revenue growth rates for 2024, 2025, and 2026 are 4.9%, 11.6%, and 15.4% respectively, with net profit growth rates of 86.5%, 59.4%, and 39.2% [3][5].