Gree Electric (000651) company in-depth research report: Gree investment story to see performance growth and estimates

Gree Electric (000651) company in-depth research report: Gree investment story to see performance growth and estimates

Main point of view: Gree’s market value gradually increases and estimates. Performance growth is affected by industry development stages and prosperity, and profit levels under changes in the competitive landscape. It is estimated that the industry’s performance growth expectations at different stages, the potential environment, and changes in the company’s dividend rate, etc.Factors.

As a traditional consumer product, performance and estimates show a positive correlation, facing Davis double-ups and double-kills.

  Estimated Davis Double Performance and Double Kill with Performance.

  Before 2000, the air-conditioning industry in developing countries was in a period of rapid development. With the industry’s high growth dividends, the company achieved high revenue growth + high estimates. Under the high growth of the industry, the market gave the company 25-30 times estimates, but the industry entry barriers were weak.The profit margin is low.

The industry competition intensified from 2000 to 2005, and the industry triggered price wars in a state of oversupply.

The profit growth rate is slower than the market growth rate under the income growth rate. Since 2004, the PE multiple is estimated to be lower.

  The investment value brought by the appearance optimization From 2006 to 2012, the industry competition gradually changed, and the industry’s profitability was optimized. After 2012, Greemei’s duopoly 厦门夜网 shape in the air conditioning industry was basically stable, and its market value was promoted at the same time as performance.
However, the industry has gradually entered a mature stage, and the estimated growth rate of income has improved compared with the previous period. Since then, the increase in the company’s market value has been driven more by performance.

  Foreign recognition of Gree under the characteristics of dividend-weighted shares Since the opening of the Shenzhen-Hong Kong Stock Connect in December 2016, a window for foreign countries to enter a stock market has opened.

The estimated gap between domestic appliance leaders and overseas leaders, Gree’s foreign shareholdings have gradually increased, and the capital structure has reshaped the transformation center.

In addition, high dividends have become the market’s stable expectation of Gree and the source of investment premiums. The dividend ratio has a certain degree of correlation with the company’s market value.

  Estimated follow-up improvement space: high dividend payout + mixed reform and high dividend payout: We are optimistic about the growth of the domestic consumer market, and the performance growth of leading companies’ brand power and product power is more stable.

According to the estimated 50% -70% dividend distribution and corresponding distribution ratio of the expected net profit profit for 2019, the distribution ratio is expected to be 3.

78% -5.

Between 29%, a significant improvement compared to 2018 estimates.

Zhuhai Mingjun promises to promote a dividend ratio of not less than 50%, and high dividends are expected to continue under the leadership of Gao.

  Implementation of mixed reforms: Optimization of shareholding structure and governance structure brought by share transfers, increased shareholding in mergers, and enhanced speaking power.

After the implementation of the mixed reforms, the equity incentive plan for listed companies with performance and backbone employees not exceeding 4% will be promoted, fair incentives will be used to promote implementation, and high retail sales will be enabled.

  Earnings Forecast and Estimates We maintain the original earnings forecast and expect the company to achieve operating income of 2102 in 2019-2021.

68 ppm, 2265.

4.1 billion, 2491.

25 ppm, a five-year increase of 5.

12% / 7.

74% / 9.

97%, net profit attributable to mother 282.

3 billion, 304.

37 ppm, 338.

16 ppm, a ten-year increase of 7.

73% / 7.

82% / 11.

10%, EPS is 4.

69/5.

06/5.

62 yuan, corresponding to the current sustainable 13/12/11 times.

The company’s mixed reforms were successfully implemented. Gao Gao’s ownership while holding the shareholding ratio and the right to speak strengthened. Regarding the complementary provisions of future equity incentive plans and dividend rates, we believe that the distribution is beneficial to the improvement of corporate governance structure and businessThe diversification and improvement of channel growth prospects, the long-term suppression of the estimated level is expected to increase, and the company’s excellent competitive structure and good profit margins are abundant. We give the company 15 times PE in 2020, corresponding to a target price of 75.

9 yuan, raised rating to “buy” rating.

  The risks indicate macroeconomic downside risks, industry boom risks, price war risks, and changes in the competitive landscape.