China Express(002928) 华创证券·2024-09-16 14:08Investment Rating - The report maintains a "Strong Buy" rating for Huaxia Airlines (002928) [1][17]. Core Views - The implementation of the employee stock ownership plan reflects management's confidence in the company's future performance. The revenue target for 2024 is set at 7.1 billion yuan, indicating a growth rate of 37.8% [1][13]. - The company is expected to benefit from the adjustment of the civil aviation bureau's branch subsidy policy and the continuous recovery of flight volumes, which are crucial for sustainable operational improvement [1][14][15]. - The report forecasts net profits for 2024 to be 329 million yuan, with a significant increase in earnings per share (EPS) projected at 0.26 yuan [2][16]. Summary by Sections Employee Stock Ownership Plan - The company plans to hold up to 4.6303 million shares, accounting for approximately 0.36% of the total share capital [1][6]. - The shares will be sourced from the company's repurchased ordinary shares, with a total repurchase cost of 50.046 million yuan [1][7]. - The purchase price for the shares under the plan is set at 2.82 yuan per share, significantly lower than the closing price of 5.33 yuan on September 13, 2024 [1][9]. Performance Assessment - The first unlock period's revenue trigger and target values for 2024 are set at 6.04 billion yuan and 7.1 billion yuan, respectively. The second unlock period assesses cumulative revenue for 2024 and 2025, with trigger and target values of 13.18 billion yuan and 15.5 billion yuan [1][10]. - The company achieved a revenue of 3.21 billion yuan in the first half of 2024, reflecting a year-on-year growth of 45.0% [1][13]. Financial Forecasts - The report maintains profit forecasts for 2024 to 2026 at 330 million yuan, 750 million yuan, and 1.26 billion yuan, respectively, with corresponding EPS of 0.26, 0.58, and 0.98 yuan [2][16]. - The price-to-earnings (PE) ratios are projected at 21, 9, and 5 times for the years 2024, 2025, and 2026, respectively [2][16]. Market Performance - The average daily flight volume for the company is recovering, with 306 flights in Q1 2024, a year-on-year increase of 49.9%, and 350 flights in Q3 2024, a year-on-year increase of 27.9% [1][15]. - The report emphasizes that the company is currently at a valuation bottom and has the potential to return to a growth trajectory [1][17].