subject: Analysis Of Suning To Maintain Market Share And Gross Margin Rise Because - Su Ning, Marketing, [print this page] 2006 1 quarterly data have been verified to some extent, the present report for Suning Appliance 2006 EPS to 1.89 yuan / share forecasts, we believe that currently results in 2007 or 2008 to the valuation is reasonable, given its target price to 80 yuan, the investment rating to "buy", the company belonging to performance-driven, investment advice to "buy and hold long term."
Suning Appliance market share each year is expected to achieve 1.5% -2% growth. Will show the efficiency of store expansion, a strong services business market space, growing consumer electronics market is to promote the growth of the three major driving forces of Suning Appliance.
Consolidated gross profit margin
Suning will maintain an upward trend, an annual increase of 0.6% -1.3%, as the rate of increase in consolidated cost of the comprehensive improvement of the inner margin fundamental guarantee.
Sophisticated operation to ensure Suning can do better. Chinese home appliance market in the context of the huge space, can only say who might do better, who's market share will gradually increase, can not be eliminated there is anyone situation.
Suning income
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1, valuation and investment recommendations
Suning Appliance
future performance based on long-term growth expectations, and optimistic about China's huge consumer electronics market space, forecast earnings per share of Suning in 2006-2008 will reach 1.89,3.04,4.60 next three years, sales CAGR for the 60% net profit CAGR to 63.91%. Reference BestBuy1991-2005 annual sales revenue CAGR was 27.33%, net profit CAGR to 40.26%, evidence of our Suning retail business as a good growth in the future development of performance expectations.
The same time, Suning Appliance Q1 2006 sales revenue of 5.03 billion yuan, up 60.85%, net profit up 121.03%, which is worth noting that an integrated and comprehensive costs margin between the rate gap continues to widen, This proves the report to improve the profitability of Suning Appliance, important points.
Therefore, we further believe that for the growth of Suning Appliance to judge future performance, taking the view that since the first quarter of 2006, growth performance has been confirmed to some extent, our performance in 2006 for Suning Appliance judgments, which can be for Suning Appliance 2007 or 2008 with a performance to valuation, we give Suning Appliance's target price of 80 yuan, investment rating to "buy."
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Profit forecasts this report there are two key points: First, the market share of Suning Appliance forecast is expected to increase 1.5% per year -2%, which is the main business income of Suning Appliance to support the growth of the main reasons; second is predicted Suning Appliance Consolidated gross profit margin will remain the trend of annual increases, but it is crucial that the consolidated gross profit margin of Suning Appliance and comprehensive cost gap between the rate of expansion will be to maintain the trend of each year, which is to improve the profitability of Suning Appliance to support the main basis .
Report, detailed analysis of these two points will be.
Third, growth and profitability analysis
(A) of the Suning Appliance market share increased 1.5% -2% per year
Face huge market home appliance chain, Suning Appliance growth impetus came mainly from the three areas, one store expansion, and second, to develop business services, third is the growth of the consumer electronics market, the last and most important management is determined to forge ahead.
