Duan Yongping talks about LAOPU GOLD: The gross profit margin of restaurants is high, but the net profit margin is low; gold shops are similar to restaurants
Duan Yongping commented on LAOPU GOLD on Xueqiu, pointing out that its gross profit margin reaches 40%, but its net profit margin is low, with a business model similar to that of a restaurant. He suggested that small-cap investors focus on large-cap leading stocks or choose low-risk methods, such as saving in banks, rather than chasing small-cap stocks
In the past few years, despite high gold prices and weak terminal sales of gold jewelry, LAOPU GOLD has achieved remarkable performance with its unique luxury positioning and traditional palace gold jewelry, boasting a gross profit margin of 40%, far better than its peers, and its stock price has continued to soar, leading some to refer to it as the "Moutai of the gold jewelry industry."
However, well-known investor Duan Yongping holds a reserved attitude towards this. On Thursday, he commented on Xueqiu, stating that the business model of the gold business is similar to that of restaurants, "there are plenty of them everywhere," "the gross profit margin is generally high, but the net profit margin is generally low."
In his comment, he suggested that for small funds and ordinary investors, rather than chasing uncertain small-cap stocks, it is better to focus on recognized large-cap leading stocks or simply choose low-risk methods such as saving in banks.
