2021-10-26 Guoxin Securities Co., Ltd. Jiang Ming and Rodin studied Jiuqi shares and issued a research report "Review of the third quarter of 21: high net profit growth in the third quarter, looking forward to the peak season performance in the fourth quarter". This report gives a buy rating on Jiuqi shares, believing that its target price is 54.10 yuan, the current stock price is 39.1 yuan, and the expected increase is 38.36%.
Jiuqi shares (300994)
High performance growth in the third quarter
In the third quarter of 2021, the company achieved revenue of 1.01 billion yuan (year-on-year + 75.6%), return-to-mother net profit of 62 million yuan (year-on-year + 75.5%), and non-return net profit of 60 million yuan (year-on-year + 81.9%).
Boost sales of electric bicycles and cross-border e-commerce to support high revenue growth
Benefiting from (1) the changes in the travel patterns of consumers in Europe and the United States brought about by the epidemic, (2) the company's vigorous layout of the field of assisted electric bicycles with high value-added products, and (3) accelerating the development of cross-border e-commerce channels (selling own-brand products directly to end consumers through cross-border e-commerce channels), the company maintained rapid revenue growth in the third quarter, with a year-on-year growth rate of + 75.6% (compared with 73.9% in the second quarter). Among them, the income growth of adult bicycles, power electric bicycles and bicycle accessories is very bright. Although the supply of shipping capacity in the third quarter is still limited, we estimate that the situation of shipping disruption has begun to improve marginally. The company's inventory in the third quarter is basically the same as the previous quarter, about 148 million yuan (141 million yuan in the second quarter). There has been no further growth (inventory has maintained a rapid growth trend since the middle of last year).
Profitability remained stable month-on-month in the third quarter, and net profit growth increased
Due to the high sea freight, the gross profit margin and net profit margin of the company's own-brand sales business have been negatively affected this year. The company's comprehensive profitability remained stable in the third quarter compared with the previous quarter, with a gross profit margin of 18.1% (15.1% in the first quarter and 18.1% in the second quarter, respectively) and a net profit margin of 6.1% (4.4% in the first quarter and 6.3% in the second quarter, respectively). Even with a credit impairment loss of 6.4 million yuan in the third quarter, the company still achieved a net profit of 62 million yuan in a single quarter, a year-on-year growth of 76% (43.7% in the first quarter and 41.0% in the second quarter, respectively).
Risk tips: higher-than-expected increase in shipping costs; policy risks of international trade frictions.
Investment advice: raise the profit forecast, maintain the "buy" rating, take into account the slightly higher-than-expected income growth, and raise the profit forecast. It is estimated that the 21-23 return net profit will be 2.1 yuan 3.0 / 410 million yuan (the forecast for 21-23 years will be raised by 6.6% PE 7.6% 0.9%, respectively), an increase of 35.8%, 42.5% and 35.1% over the same period last year, with a target valuation of 32-35 times PE. The target price is 49.5-54.1 yuan, giving the company a "buy" rating, and now the stock price corresponds to the PE valuation of EPS in 22-23 at 26X and 19X, respectively.
The stock has been rated by three agencies in the last 90 days, including two buy ratings and one overweight rating; the average institutional target price in the past 90 days is 51.8; according to the Securities Star valuation analysis tool, Jiuqi shares (300994) has a rating of 3.5 stars, a good price rating of 0.5 stars, and a comprehensive valuation rating of 2 stars.