Farah Electronics (600563): Short-term performance pressure does not change the company’s high-quality characteristics

Farah Electronics (600563): Short-term performance pressure does not change the company’s high-quality characteristics

Event: Farah Electronics released the third quarter report of 2019, and the company achieved revenue 11 in the first three quarters.

92 ppm, a ten-year average of 7.

56%, net profit attributable to mothers3.

4.0 billion, down 6 every year.

32%, deducting non-net profit 2.

870,000 yuan, at least -11.

82%, lower than expected.

Single quarter revenue in the third quarter of 193.

98 ppm, at least -11.

82%, net profit attributable to mother was 0.

95 ppm, with a ten-year average of 13.

5%, net profit after deduction is 0.

92 ppm, at least -21.

31%.

Single quarter gross profit margin 42.

7%, rising by 0 every year.

1 piece, down 0 from the previous month.

1 unit, basically stable.

The expense ratio has increased, and management expenses and R & D expenses have increased by 1 each year.

4 and 0.

8 units.

The cash flow performance was excellent, and operating cash inflows and net operating cash flows reached record highs.

Demand for new energy vehicles grew faster than expected, and traditional demand continued to be weak, which was the main reason for the company’s decline in 西安耍耍网 the third quarter.

According to the data of the China Automobile Association, 3Q19 domestic new energy vehicles were sold for a total of 21.

90,000 vehicles in the past decade 19.

1%, about 61 in the first half.

The previous 3% growth rate was significantly incident.

In addition, demand for home appliances, lighting, and industry continued to weaken.

Air-conditioning sales in the third quarter were 3247.

70,000 units, with a ten-year average of 0.

6%; the overall demand for lighting is expected to reach about 20%.

Although the PV demand growth has been significant throughout the year, considering the low base effect of last year, its overall performance has been limited.

The short-term performance is under pressure, focusing on the progress of overseas new energy vehicle customers.

In the short term,深圳桑拿网 the decline of new energy vehicle subsidies is expected to still affect downstream demand in 4Q19, while the elasticity of demand in traditional fields such as home appliances and lighting is weak. The overall performance in the fourth quarter was under pressure, focusing on the progress of overseas new energy vehicle customers.

Good company, good industry, optimistic about long-term investment value, maintain “Buy” rating.

Farah Electronics is a representative of high-quality companies. ROE is maintained at more than 17% throughout the year, and free cash flow accounts for more than 15% of revenue.

The company’s industry structure is stable, the barriers are high, and the growth is determined.

Although the company’s short-term performance is under pressure, we are optimistic about the company’s competitive advantage in the industry and its long-term investment value.We expect the company’s net profit to be 4 in 2019-2021.

21, 4.

57 and 5.

120,000 yuan, the current sustainable PE is 22.

62x, 20.

85x and 18.

63x, maintain “Buy” rating.

Risk warning events: demand for overseas new energy vehicle markets exceeds expectations; traditional demand is weak; industry competition intensifies risks.