Investment Rating - The report maintains a "Recommendation" rating for Huamao Logistics (603128) [1] Core Views - The company reported a decline in net profit for Q3 2025, with a net profit of 0.8 billion, down 53% year-on-year, primarily due to increased investments in overseas capabilities during the cultivation period, which has put short-term pressure on profits [1] - For the first three quarters of 2025, the company achieved a total revenue of 137.2 billion, a decrease of 4.8% year-on-year, with Q3 revenue at 49.5 billion, down 14.9% year-on-year but up 3.5% quarter-on-quarter [1] - The gross profit for the first three quarters of 2025 was 12.8 billion, down 18.1% year-on-year, with a gross margin of 9.4%, a decrease of 1.5 percentage points year-on-year [1] Financial Summary - Total revenue forecast for 2024A is 17,525 million, with a projected decline of 0.6% in 2025E, followed by growth of 9.1% in 2026E and 7.9% in 2027E [2] - The net profit forecast for 2024A is 539 million, with a significant projected decline of 27.0% in 2025E, followed by a recovery to 15.0% growth in 2026E and 14.8% in 2027E [2] - The earnings per share (EPS) is expected to be 0.41 in 2024A, decreasing to 0.30 in 2025E, and then gradually increasing to 0.35 in 2026E and 0.40 in 2027E [2] Business Development - The company is actively expanding its overseas logistics network, having established new overseas companies in countries such as Indonesia, Uzbekistan, and Saudi Arabia, in line with the "Belt and Road" initiative [6] - As of June 2025, the company has over 90 self-owned overseas points, covering major ports and core logistics cities across six continents, with more than 40 self-operated overseas warehouses totaling 800,000 square meters [6] - The company is enhancing its comprehensive logistics services, extending international air transport capabilities to overseas terminals and opening new shipping routes in East Africa, the Middle East, and Indonesia [6] Investment Suggestion - The report forecasts net profits of 3.9 billion, 4.5 billion, and 5.2 billion for 2025-2027, with corresponding EPS of 0.30, 0.35, and 0.40, and PE ratios of 21, 18, and 16 respectively [6] - The target price is set at 7.6 yuan, representing a 22% upside from the current price of 6.24 yuan, maintaining the "Recommendation" rating [2][6]