WANXIN MEDIA(601801) 天风证券·2024-11-10 12:19Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 7.59 yuan [5] Core Views - The company's main business remains stable, with ample cash on hand, totaling 10.582 billion yuan as of Q3 2024 [1] - Despite a 16.6% YoY decline in Q3 2024 revenue to 3.125 billion yuan, the company's net profit attributable to shareholders decreased by 10.09% YoY to 233 million yuan [1] - The company is actively diversifying into smart education, supply chain, and cultural services, which are expected to benefit from AIGC development and enhance profitability [3] Business Performance - Textbook sales remained relatively stable, with a slight decline of 1.52% YoY in Q3 2024, while general book sales decreased by 7.59% YoY [1] - The company operates 804 physical stores across Anhui, Jiangsu, and Beijing, forming a comprehensive distribution and education service system [1] - Gross margin remained stable at 23% in Q3 2024, with textbook and general book gross margins at 25.08% and 39.44%, respectively [2] Strategic Initiatives - The company is extending its education service industry chain and strengthening its supply chain service system, with a focus on digital management platforms and key theme publications [2] - It is accelerating the layout of AI education products, collaborating with Huawei and ZhiPu to develop AI-driven educational solutions and reading models [3] - The company is actively promoting quality education solutions, including research education, labor education, and after-school services, aiming to build an education industry ecosystem [2] Financial Projections - Revenue for 2024-2026 is projected to be 11.8 billion, 13.0 billion, and 14.0 billion yuan, with YoY growth rates of 5%, 10%, and 8%, respectively [3] - Net profit attributable to shareholders is expected to be 766 million, 932 million, and 1.06 billion yuan for 2024-2026, with EPS of 0.39, 0.48, and 0.54 yuan per share [3][7] Industry Context - The company operates in the media/publishing industry, with a focus on educational materials and digital transformation [5] - The industry faces challenges such as declining demand for supplementary teaching materials and slower-than-expected development of digital services and smart education [4]