Changan Automobile (000625): Q4 improved significantly in performance growth

Changan Automobile (000625): Q4 improved significantly in performance growth
Event: The company announces the 2019 annual performance forecast: it is expected to be 24 per year in 2019.0 ppm-29.0 billion, a decline of 452 per year.6% -526.0%; Q4 is expected to be 2.40,000 yuan-profit 2.600 million. The company’s 杭州夜网 performance was lower than our expectations. Overall sales continue to increase, and performance is expected to improve. The improvement in Q4 performance improved the company’s sales in 2019 to 176.0 million vehicles, a decrease of 15 every year.2%.Of which: Changan Ford 18.40,000 vehicles, a decrease of 51 every year.3%; Changan Mazda 13.40,000 vehicles, a decrease of 19 per year.7%; Changan Autonomous 113.30,000 vehicles, down 5 every year.7%.The company’s previous major profit contribution was a joint venture brand, but in 2019, due to multiple factors such as the continued downturn in the industry’s prosperity and the intensification of Ford trucks, joint sales have dropped significantly, resulting in a significant gradual improvement in the company’s performance in 2019.The company expects to expect 2 in Q4 2019杭州桑拿网.40,000 yuan-profit 2.US $ 600 million, which is expected to end for five consecutive quarters of breakthrough and usher in the first quarter of profit, reaching 4 compared with the third quarter of 2019.A significant improvement of US $ 200 million has been achieved, with initial improvements for independent brands.This round of autonomy has been significantly enhanced by the CS75 Plus and other brands. The subsequent trend has continued to form a positive contribution to the improvement of the company’s overall performance. Opening the third venture on its own, CS75 has driven its own brand to be quite distinctive. Regarding the phenomenon that Changan’s independent million-dollar production and sales scale is still not profitable, the company started its third venture. The main ideas are: 1) Strengthen the deployment of electric intelligent network connection and improve independenceProduct quality, to achieve a progressive upward brand; 2) On the brand, the V standard is used as the core for addition, and other brands Auchan and Kaicheng do subtraction for mixed modification. In the future, they may give up control and do not merge the scope of consolidated statements.We believe that the independent brand has been quite effective, and the current CS75 monthly sales volume has reached 2.90,000 vehicles, the profit of independent brands will continue to improve, and is expected to change from a drag on the company’s overall performance to a positive contribution. Ford strong cycle + Lincoln localization is the strongest logic, the company’s performance is full of flexibility. Changan Ford opens a strong product cycle: 2018 Fox replacement model, Furuis remodeling has been listed; 2019 has sharp mid-range remodeling, Ruiji, LincolnAdventurers go public; 2020Q1 Ford large SUV explorer is localized, and Lincoln Flying Home goes public; in 2021, the new Sharp World and Lincoln Voyager will go public.We believe that the highlight of this round of Changan Ford’s strong cycle is to surround Lincoln with an attempt to significantly improve Changan Ford’s profitability.The “resonance” of the company’s product cycle and industry cycle will greatly improve the flexibility of the company’s performance. Earnings forecast and investment recommendations lower 2019 earnings forecast: The company’s EPS for 2019-2021 is expected to be -0.55 yuan, 0.76 yuan, 1.67 yuan, corresponding to -18.1x, 13.0 times, 5.9 times.Maintain the company’s “Buy” rating. Risk warning: The domestic auto industry is weaker than expected; the company’s product sales are lower than expected; Changan Ford’s new car launch is lower than expected.