Text丨Liu Zenglu
Before the May Day holiday, the stock index continued to try to rebound, but it was obvious that it did not dare to develop in depth, and the market hotspots switched frequently, and the sense of direction was unclear. For the investment opportunities in the future, brokerages seem to be more optimistic about the manufacturing sector, and have given buy ratings to a number of companies, brokerages believe that as many as 106 companies have more than 50% upside in the future.
Manufacturing investment is in the limelight
This week, the A-share market was actively traded, but the sense of direction was not clear, individual stocks were mixed, and hot spots switched frequently.
Approaching the May Day holiday, there is a peak in the disclosure of annual and quarterly results at the end of the month, and the stock index is still trying to rebound, but it obviously feels that it does not dare to develop in depth. There are only 2 trading days left before the end of the double financial report disclosure, and there are still more than 700 companies in the market that have not released their 2023 annual reports, and more than 1,800 companies have not released their first quarter reports for 2024.
For the investment direction after May, Soochow Securities said that manufacturing investment is in the limelight. In the first quarter of this year, manufacturing investment not only outpaced infrastructure investment in terms of growth, but also contributed 41% of the rebound in fixed asset investment, bringing a touch of spring to the domestic economy. Previously, the mainland has also pressed the "acceleration button" of manufacturing investment twice, once in 2018 and once in 2021, and the importance of promoting the development of manufacturing industry has also returned to the stage under the background of accelerating the development of overseas AI and increasing subsidies for emerging industries in major developed economies.
According to the investment growth rate of the manufacturing sub-sector, the main impetus for the expansion of investment comes from industries with higher technology content, such as general equipment, special equipment, electronic equipment, medicine, automobiles, etc. Benefiting from the favorable policies to promote the upgrading of the manufacturing industry, the investment growth rate of the "new quality" industry is significantly faster than that of the "old quality" industry, which has become an emerging engine for the development of the manufacturing industry.
In mid-to-late April, after the release of new regulations such as "Several Opinions on Strengthening Supervision and Risk Prevention to Promote the High-quality Development of the Capital Market" and "Opinions on Strictly Implementing the Delisting System", major securities firms have been enthusiastic about research, and 1,178 companies have been given buy ratings. Combined with the statistics of some companies with clear target prices, the target prices of 682 companies have upside space compared with the current stock price, and the industry distribution of such companies is mostly from manufacturing sectors such as medicine, communications, light manufacturing, automobiles, machinery and equipment, electronics, and power equipment.
The stock prices of 5 companies may double in the future
According to the statistics of the upside space of the target price of the brokerage compared with the company's stock price, a total of 106 companies have 50% upside, and 5 companies such as CTI and Lixun Precision have the room for doubling the target price given by the brokerage compared with the current stock price.
On April 19, analysts at Guolian Securities gave a target price of 27.58 yuan, which is 121.7% upside from the current closing price of 12.44 yuan. It has a view that although the company's medical testing sector as a whole may still be under pressure in 2024, related tests such as soil sanpu, double carbon, and aviation testing are expected to bring incremental growth to the company. It is estimated that the company's revenue from 2024 to 2026 will be 6.344 billion yuan, 7.571 billion yuan and 8.882 billion yuan respectively, and the net profit attributable to the parent company will be 1.069 billion yuan, 1.291 billion yuan and 1.616 billion yuan respectively, and the revenue and profit will continue to achieve double-digit growth.
Lixun Precision, which involves the concept of high-speed connectors, has recently been jointly recognized by many brokerages such as Tianfeng Securities, Guotai Junan, and China Merchants Securities, and Jun has given the expectation that the stock price will double in the future. Among them, Tianfeng Securities analysts gave the highest upside expectations, and the target price of 63 yuan in the latest report on April 25 has 118.83% room compared with the current one. The reason is that the company's dividend intensity has increased significantly, and it continues to lay out core tracks such as consumer electronics, communications, and automobiles, and the performance expectations for 2023, the first quarter of 2024, and the semi-annual performance of 2024 are all in line with expectations.
In the field of consumer electronics, Luxshare Precision is the exclusive supplier of Vision Pro (Apple's first head-mounted "spatial computing" display device). In the field of high-speed interconnection of data centers, the company cooperates with leading chip manufacturers to jointly formulate next-generation high-speed connection standards such as 800G and 1.6T for the world's mainstream data centers and cloud service manufacturers. On this basis, the company takes this as the entry point to comprehensively pull optical connection, heat dissipation, power module and other products to carry out further in-depth cooperation with head customers. The automotive field has also completed the diversified layout of products, and the company's controlling shareholder has acquired BCS, a subsidiary of ZF in Germany, and has mastered many high-quality customer resources such as BMW, Volkswagen, GM, and Ford.
Feng Liu, Ge Weidong and Zhao Jianping are highly optimistic about the heavy stocks of brokers
It is not difficult to find that many companies that have been given a large upside by brokerages have long been heavily held by institutional funds or well-known investors.
For example, Baofeng Energy, Hikvision, Angel Yeast, Zhongju High-tech and other companies have successively received buy ratings from brokerages in mid-to-late April, and the target price has more than 30% upside from the current stock price. Combined with the statistics of the company's first quarterly report, the above companies are all heavy stocks of Feng Liu, the star fund manager of Gaoyi Assets, but compared with the end of the fourth quarter of last year, only Angel Yeast has been further increased by Feng Liu, and the list of major shareholders of the company also appears in the Hong Kong Securities Clearing Co., Ltd., Kuwait Government Investment Authority, Wells Fargo Research Select Flexible Allocation Mixed Fund and other institutional funds (see Figure 1).
GigaDevice is a long-term heavy stock of Niu San boss Ge Weidong, and since the new heavy position in mid-2018, Ge Weidong will appear on the company's list of major shareholders at the end of each reporting period. And the latest position at the end of the first quarter of this year was the same as that at the end of last year, and it continued to be the third largest shareholder of the company with a position of 18.722 million shares.
On April 23, analysts at China Securities Construction Investment gave a target price of 104 yuan to GigaDevice, which is 32.15% upside from the current stock price. On April 20 and 21, SDIC Securities and GF Securities also gave target prices of 102.8 yuan and 102.82 yuan respectively, which also has more than 30% upside compared with the current one. The reason is that the company's performance is outstanding, and it is mainly due to the recovery of consumer market demand and the increase in memory chip shipments, which has driven the growth of operating income and net profit attributable to the parent company.
Also as a super bull in the A-share market, Zhao Jianping and Zhao Ji's joint heavy dividend Yang chip at the end of 2023 received a buy rating from Guojin Securities on April 16, with a target price of 21.2 yuan and an upside of 29.19% compared with the current one. The company is a well-established third-party testing company in China, and its business areas cover CP (wafer) testing and FT (finished product) testing. As industry leaders, Jingyuan Electronics, Xinquan, and Sige have all achieved month-on-month growth in monthly revenue in March 2024, and the performance of domestic third-party testing companies is expected to usher in a bottom-up inflection point. Combined with the company's latest major shareholder positions, Zhao Jianping's shareholding at the end of 2023 was the same as that in the previous reporting period, and Zhao Ji increased his position by 1 million shares (see Figure 2).
(The individual stocks mentioned in the article are for example analysis only, and do not make trading recommendations.) ）