The performance in 2017 is expected to increase by 100% to 150%. EPS0.78~0.98 Yuan has previously announced that its net profit in 2017 is expected to increase by 100% to 150% over the same period last year. The main reasons are: changes in the structure of real estate income projects settled by ① and lower taxes; the scale of real estate projects under construction in ② has expanded over the previous year, and interest capitalization costs have increased; the rental income of ③ Zhongzhou holding Financial Center and the operating income of Zhongzhou Marriott Hotel have increased compared with the same period last year. ④ Company strengthens cost control and reduces sales expenses.
Steady sales and positive expansion
In ① 2017, the company's sales projects were mainly located in cities with strong real estate policies, such as Shanghai and Chengdu, but still achieved steady growth-- according to Kerry data, the company achieved a sales area of 900000 square meters from January to December 2017, an increase of 7.12% over the same period last year; sales of 11.23 billion yuan, an increase of 6.09% over the same period last year; and the average sales price of 12354 yuan per square meter, keeping stable The new construction area of ② is about 103 million square meters; the land area / sales area is about 1.15, with active expansion, and the new projects are mainly distributed in the Pearl River Delta; ③ and Tibet Zhongping Xin jointly set up an urban renewal fund with a total size of 4.5001 billion yuan, with a duration of 10 years.
The performance lock is good
By the end of the third quarter of 2017, the asset-liability ratio of the company excluding accounts received in advance was 79.2%; the guarantee ratio of short-term solvency-monetary funds / (short-term loans + non-current liabilities due within one year) was 0.92 times. The company received 11.707 billion yuan in advance at the end of the third quarter of 2017, and after deducting wind's consensus revenue for the fourth quarter of 2017, the rest can still lock in 112% of wind's consensus revenue in 2018.
The incentive system is comprehensive and conducive to long-term development.
The incentive system is comprehensive, including equity incentive, employee stock ownership and project follow-up investment, which is conducive to the long-term development of the company-- ① stock option plan: it is proposed to grant 20 million stock options to the incentive object with a validity period of not more than 51 months, with an exercise price of 15.4 yuan per share in three phases. The performance evaluation target is that the net return profit for 2018, 19 and 20 years is not less than 10 yuan, 14 yuan and 2 billion yuan respectively. ② employee Stock ownership Plan: issued in April 2016, with an average transaction price of 15.75 yuan per share, the current remaining 18.09 million shares, and will be extended for one year to April 2019; ③ follow-up investment system: when the cash flow of the project company is positive and is expected to continue to be positive, and the shareholder loans and interest of the project company have been fully returned, you can apply for income pre-distribution.
The valuation is already attractive, with a "buy" rating for the first time. To sum up, the company's net profit has increased significantly in 2017, its performance is well locked in 2018, and the assessment target based on equity incentives is also expected to achieve significant growth. The current stock price is lower than the same period in 2017, the dynamic PE in 2018 is only 10 times, and the dynamic PE in 2019 is even lower, so the valuation is already attractive. It is estimated that in 2017 and 2018, the EPS will be 0.88,1.5 yuan, corresponding to PE 18,10.6X, giving a "buy" rating for the first time.
Risk.
If the industry heats up again, overheating leads to a new round of regulation and control expectations, or the company's sales growth stalls.