CMSC: Xunfei Health (02506) is expected to maintain long-term competitiveness in medical AI.

CMSC released a research report stating that XUNFEIHEALTH (02506) is expected to maintain long-term competitiveness in the medical AI field, thanks to its years of deep cultivation in the Chinese medical industry and its product synergy in the three major end markets, amidst the trend of "equalization" of large models. The firm pointed out that the company is currently trading at a valuation multiple of 26.1 times sales and 29.8 times book value, higher than comparable companies in China and the United States. The report mentioned that the company's financial performance has been relatively stable in recent years, and projected that full-year revenue in 2024 will grow higher than the previous year. With the continuous iteration of the company's AI technology, revenue sources are gradually shifting from grassroots hospitals to higher-level hospitals, driving patient-side revenue growth as well. Additionally, the company highlighted that the growth in service-related fees over the past year has been faster than project-based fees, with the proportion of one-time income decreasing from 91.5% to below 80%, indicating a shift from project-oriented thinking to result-oriented product thinking. In terms of losses, the company stated that the absolute value and proportion of losses will narrow in 2024.