Analysis of Strong Performance of Mengsheng Electronics (688311)

Based on tushare_strong_pool data, Mengsheng Electronics (688311.SS) entered the strong stock pool on December 26, 2025. The company belongs to the Technology/Communication Equipment sector, with a current price of $48.33 and a market capitalization of $8.12B[0][2].

The core catalyst is the booming enthusiasm in the commercial aerospace sector. On December 25, more than ten stocks in the sector hit their daily limit, and Mengsheng Electronics, as a component stock, ranked among the top gainers[1]. The company布局 satellite navigation and satellite communication products in the commercial aerospace field: satellite navigation products are applied in rocket control arrow-machine systems, while satellite communication products target application terminals for constellations such as Tiantong Satellite and Low-Earth Orbit (LEO) Satellites. Its clients include leading enterprises like China Aerospace Science and Technology Corporation (CASC) and LandSpace[3], directly benefiting from industry growth expectations.

Over the past three days (December 24 to December 26, 2025), the company’s stock price rose consecutively with gains of 5.37%, 7.55%, and 13.03% respectively, accumulating a 27.89% increase. On December 26, it hit a 52-week high of $49.44 intraday[2][0]. Trading volume significantly increased from 11.79M on December 24 to 20.78M on December 26, far exceeding the recent average, indicating increased capital attention[0]. Technicals show an upward trend (to be confirmed), with a buy signal issued on December 25, resistance level at $49.44, support level at $40.53, and next target level at $51.95[0].

Driven by technological breakthroughs (such as improved launch vehicle capacity) and policy support, institutions believe the industry is expected to迎来 a rapid growth inflection point, and sector enthusiasm continues[3]. On December 26, the company’s main capital net inflow reached $62.3606 million, indicating active participation of institutional funds[2].

1. Significant Sector Linkage
   : The company’s short-term strong stock price mainly relies on commercial aerospace sector momentum rather than its own profit fundamental support. The sustainability of sector catalysts is the core of the rally’s continuation.
2. Divergence Between Technicals and Fundamentals
   : Technicals show an upward trend with obvious capital inflow, but the company is in a loss-making state (TTM P/E of -42.36x, net profit margin of -63.74%, ROE of -11.91%), so the sustainability of the rally is questionable[0].
3. Short-Term Capital Game
   : Amplified trading volume accompanied by main capital net inflow indicates short-term capital’s positive attention to the sector and the company, but profit-taking pressure needs to be警惕.

• Insufficient Fundamental Support
  : The company is currently loss-making, with negative net profit margin and ROE, so the stock price rise lacks profit support[0].
• Technical Overbought
  : The RSI indicator suggests overbought risks, and there may be correction pressure in the short term[0].
• Sector Volatility Risk
  : The commercial aerospace sector is greatly affected by factors such as policy and technological progress, and the sustainability of the rally depends on the continuous release of sector catalysts[3].

• Continuous Sector Catalysts
  : If commercial aerospace industry policies, technological breakthroughs, and other catalysts continue to be released, the company is expected to continue to benefit.
• Potential to Break Through Resistance
  : If the stock price breaks through the short-term resistance level of $49.44, it may further open up upward space[0].

Mongsheng Electronics entered the strong stock pool due to commercial aerospace sector enthusiasm, with significant short-term gains and increased capital attention. Technicals show an upward trend, but overbought correction risks need to be警惕; fundamentals are loss-making, and the rally mainly relies on sector momentum, so sustainability remains to be observed. Investors should pay attention to the progress of commercial aerospace sector catalysts and the improvement of the company’s fundamentals.