WFHT(SZ:000581) GF SECURITIES·2024-04-21 05:32Investment Rating - The report maintains a "Buy" rating for the company, with a reasonable value estimated at 27.01 CNY per share based on a 13x PE for 2024 [10][12]. Core Insights - The company has demonstrated strong profitability with a significant increase in net profit, reporting a year-on-year growth of 1446.3% for non-recurring net profit and 1231.5% for net profit attributable to shareholders in 2023 [9][18]. - Despite a decline in revenue of 12.9% year-on-year to 11.09 billion CNY, the company has maintained a solid financial position with ample cash reserves and a substantial increase in cash dividends [9][35]. - The company's gross margin and net margin improved significantly in 2023, reaching 17.5% and 17.2% respectively, with further improvements noted in Q4 2023 [9][18]. Financial Performance Summary - In 2023, the company achieved a revenue of 11.09 billion CNY, with a net profit of 1.84 billion CNY and 1.60 billion CNY for non-recurring net profit, reflecting substantial growth compared to the previous year [9][11]. - The Q4 2023 results showed a revenue of 2.75 billion CNY, with a non-recurring net profit of 520 million CNY, indicating a recovery trend with a quarter-on-quarter growth of 24.3% [9][18]. - The company’s cash and cash equivalents, along with other liquid assets, totaled 6.80 billion CNY at the end of 2023, despite a 10.5% decrease year-on-year [9][35]. Profitability and Forecast - The company is expected to maintain a stable earnings trajectory, with projected EPS of 2.08, 2.31, and 2.53 CNY for 2024, 2025, and 2026 respectively [10][41]. - The report anticipates a gradual recovery in revenue growth, with estimates of 5.1%, 5.2%, and 5.4% for the years 2024 to 2026 [11][41]. - The company’s return on equity (ROE) is projected to improve to 10.0% by 2024, reflecting enhanced profitability [11][41].