Event
Up to now, many unlisted securities companies have disclosed uncensored financial statements of 2008. We chose 45 companies to probe into the earning change in securities industry through the analysis and comparison.
Our Analysis and Estimation
1) 2008 earning of securities companies declined generally.
2) Performance differentiation mainly depended on difference of capital operation return.
3) Income structure changed with cycle transformation.
4) Income reduction and expense ratio ascension led obvious fall in profitability of securities companies.
5) Capital operation return will dominate performance differentiation of securities companies in 2009.
Investment Suggestion
Based on current capital operation return, Northeast Securities (000686), Guoyuan Securities (000728) and Hong Yuan Securities (000562) possess potential of more rapidly increasing performance. So in the short term, they will perform better while stock market is advancing and investors may keep an eye on them. In terms of long-term investment, valuation risks of these companies shall be paid attention to.