November 8 evening, Geer shares (002241.SZ) issued a public announcement, said it received a large overseas customer notification, suspension of production of a smart acoustic machine products, the business changes are expected to affect the 2022 annual operating income of not more than 3.3 billion yuan, accounting for about 4.2% of the company's audited operating income for the year 2021, said the impact of this matter on the operating results is still being assessed. The company said the impact of the matter on the company's operating results is still being assessed.
The outside world has speculated that the announcement of the "overseas customers" that Apple, the suspension of the production of products referring to the AirPodsPro2. a time, the market winds of panic, in the possibility of being kicked out of the "fruit chain" in the mood of fear, Geier shares The next morning opening directly stopped. In stark contrast, the industry's head brokerage CITIC Securities issued a research report on the same day, that overseas large customers "cut single" the subsequent impact needs to be observed, Geer shares in the field of AIoT strength is solid, is expected to take over the growth of the smartwatch, optimistic about the VR / AR card position and competitive advantage. Give 30 yuan target price, and still maintain the "buy" rating on the company.
The difference between the market and the head of the organization's view is so great that one can not help but think, the market is overreacting? Gore stock price drop is just the market short-term emotional venting? The well-known American investment guru Howard Marks has mentioned that when the market is caught in a widespread panic, individuals to maintain independence and thinking is actually very difficult to follow the trend of selling almost an instinctive reaction to maintain the safety of their own funds, investors are very difficult to self-control. But at this moment, for tracking and attention to the Geer shares, upholding the long-termism of investors, perhaps more meaningful is to rationally analyze the long-term impact of this incident on the fundamentals of the Geer shares.
Detailed analysis, panic spread, the company's share price fell, is nothing more than investors worried about the Geer shares were kicked out of the "fruit chain" and a series of chain reaction triggered. To summarize, investor panic can be roughly attributed to the sudden "cut single" after the company may face the following results:
-impact on the sales of smart headset Geer shares
-impact on the current and future revenue Geer shares
-may lose the " fruit chain" sign for the company's stock price fell. Fruit Chain" sign for product endorsement, star stock scenery is gone
Impact on smart headset segment sales:
Being "cut a single" = leaving "Fruit Chain"? "?
Vision focus back to the rumored suspension of this cooperation AirPodsPro2.Related research data said Geer shares in Apple's share of this version of the headset accounted for about 30% to 40%, if the business changes on operating income impact of no more than 3.3 billion yuan, according to CITIC Securities estimates, corresponding to the impact of profit of about 200 million yuan, and the subsequent decline in production capacity utilization rate resulting in the provision of Impairment and other impacts still need to be further observed. It can be seen, the "cut single" is indeed on the performance of Geer shares have a certain negative impact.
However, data analysis should not only consider the absolute value, but also measure the relative value. Geer's main business is divided into precision components, intelligent acoustic machine, intelligent hardware three plates. Public information shows that its intelligent acoustic machine business revenue of 19.89 billion yuan in the first three quarters of this year, accounting for about 26.8% of the company's total revenue of 74.15 billion yuan in the first three quarters. This means that the 3.3 billion yuan of revenue accounted for the first three quarters of the intelligent acoustic machine business of about 16.6%, accounting for the first three quarters of the total revenue of about 4.45%. The impact is still in the "controllable" range.
Additionally, it should be noted that the suspension of cooperation business is only for a new smart headset machine, the rest of the two sides have been stable cooperation headset machine, speaker machine and parts and components products are still in normal supply.
This view is also recognized by the industry. Was engaged in supply chain management in Apple, currently in a consumer electronics company as an executive Mr. Chen said to the "Red Weekly": "Apple's different products are operated by different teams, this time to stop the cooperation of just a product, does not represent a complete break. There are not many suppliers in this field, and from the consideration of supply chain security, Apple is unlikely to leave Geer in the short term. In addition, most of the Geer shares do the role of new product introduction, the process development capabilities require a high degree of competence, this ability is also difficult for its competitors to have in the short term."
Public information shows that as early as 2010, Geer reached a partnership with Apple.In 2018, the company officially began to supply TWS headphones for Apple. The two together so far, Geer shares by the "cut single" is true, but the "fruit chain" player "label" is still firmly stuck in the body, and not so easy to lose.
Impact on current and future revenue:
Goer also suffered from "Apple dependency"?
"Does Gore have Apple dependency?"
In my opinion, the answer is yes, but not to the extent of "serious illness".
According to Dongcai Choice, from 2019 to 2021, Geer's revenue will increase from 35.148 billion yuan to 78.221 billion yuan, with a compound growth rate of 49.18%; and its net profit will increase from 1.281 billion yuan to 4.275 billion yuan, with a compound growth rate of 82.68%.
Including, intelligent acoustic machine revenue from 14.823 billion yuan to 30.297 billion yuan, accounting for the proportion of revenue from 43.65% to 39.37%. Intelligent hardware is a breakthrough, revenue from 8.514 billion yuan to 32.809 billion yuan, compound growth rate of 96.3%, more than the average growth rate, accounting for the proportion of revenue also increased from 25.07% to 42.64%. In 2021, the company's smart hardware segment operating profit of 4.564 billion yuan, about 1.434 billion yuan higher than the smart acoustic whole profit.
Gele's intelligent hardware segment business mainly includes VR/AR, smart wearable and smart home and other intelligent hardware machine product business. A number of mainstream investment institutions in the research report, frequently referred to the Geer shares through the strategic layout as well as technological advantages, in this sector occupies a leading position.
In the VR/AR field, Meta, Sony, Pico are all head manufacturers, occupying a large market share. According to CITIC Securities analysis, the overall shipments in 2022 is expected to be about 11 million units +. 2023 Meta, Apple, Sony, Pico are expected to launch new products, the industry growth rate is expected to return to 40% to 50%. And Geer is the exclusive supplier of Meta, Sony, Pico enterprises. In the field of smart watches, Geer is also Huawei, fitbit and other watch products main supplier. Geer has said to the public, at the moment is also actively expanding some of the automotive electronics, haptics and other new business direction.
Gele has also recently responded to investor questions on the interactive platform, pointed out that: "short-term challenges do not change the company in the medium and long term in the virtual reality and other major tracks of the significant competitive advantages and good prospects for development". It can be seen that Geer's pillar business is migrating from TWS headset to VR products. "Apple dependence" is there, but not so serious, VR / AR, smart wearable and smart home and other smart hardware business prospects are still worth looking forward to.
"Fruit chain" empowered by the star stock?
Who exactly is endorsing Geer's product power?
In addition, the aforementioned industry insiders also said that Gore was "cut" AirPodsPro2 orders, the reasons are generally multi-faceted and more complex, the outside world generally talked about is only "the iceberg surfaced that part! "This part of the business for the AirPodsPro2 orders to undertake Gore competitors is also a challenge, if Gore's technology continues to improve, the future may not be without a turnaround.
Putting aside the "fruit chain" halo, from other customers with the Geer long-term stable cooperation, downstream customers have used "real money", showing recognition of Geer's product power. The market's love for the "Apple supplier" halo is nothing more than the competitiveness of the products it represents and the wide moat the company has built.
In the final analysis, it is not the "fruit chain halo" that can endorse Gore's product strength, but the company's excellent products themselves. If you want to develop, you can't rely too much on a single big customer, nor can you focus too much on a single track. The stock price adjustment is also a vivid lesson for this fast-growing enterprise.
Graham once said, "The market is a voting machine in the short term, but it is a weighing machine in the long term." Weighing in the midst of high negative sentiment is highly likely to result in a large deviation from the actual situation of enterprises. At present, Dongcai Choice data shows that the valuation of Geer shares is at a historical low. Geer shares value in the end geometry, in the market mood to return to rationality, perhaps we can get closer to the real answer.