As the annual report season progresses, a dense batch of 2025 annual reports (including preliminary results) from listed companies has been released, bringing a group of high-quality performers to light.

Historical data shows the Shanghai Composite Index has risen more than 80% of the time during the five trading days preceding the Spring Festival, with an average gain of 1.76% based on performance between 2000 and 2025. Last week (February 2-6, 2026), the A-share market underwent adjustments, with the Shanghai Composite Index declining 1.27% cumulatively. With only five trading days left before the Lunar New Year, investors are watching to see if the pre-holiday "bonus" rally will materialize.

Notably, on Friday, February 6, 2026, the Dow Jones Industrial Average surpassed the 50,000-point mark for the first time. US markets closed with significant gains across the board: the Dow rose 2.47%, the S&P 500 increased 1.97%, and the Nasdaq Composite climbed 2.18%. The technology sector led the advance, with the Wind US Information Technology Index surging 4.38%, followed by the Wind US Industrials Index, which gained nearly 3%. Additionally, the Wind US-listed China Tech Leaders Index and the Nasdaq Golden Dragon China Index jumped 2.9% and 3.71%, respectively.

Data from the past 15 years indicates a correlation between US stock index performance before the Chinese New Year and subsequent A-share movements. From 2008 to 2025, the direction of the Dow's movement on the sixth trading day before the holiday aligned with the Shanghai Composite's performance over the subsequent five days more than 75% of the time. One securities firm suggested that, considering current market liquidity and sentiment indicators, the broader A-share index has limited downside and is expected to stabilize before the holiday, potentially initiating a new upward trend around the Spring Festival period.

Statistics reveal that 62 companies have achieved consecutive annual net profit growth for five years, based on profitability in 2020 and the disclosure of 2025 results (including preliminary figures and the lower bounds of forecasts). These firms are predominantly concentrated in industries such as machinery and equipment, banking, automobiles, and pharmaceuticals, with the machinery sector contributing nine companies.

The machinery and equipment sector reported a substantial overall net profit increase for 2025. Based on disclosed results, the sector's aggregate net profit surged over 290% year-on-year, ranking among the top performers across 31 primary industries. Companies attributed growth primarily to cost reduction and efficiency improvements enhancing profitability, alongside accelerated expansion into emerging markets and advancement of global strategies while maintaining traditional business.

The banking sector contributed eight companies, mainly city and joint-stock commercial banks. China Merchants Bank reported a record annual net profit exceeding 150 billion yuan for 2025. The automotive and pharmaceutical sectors each had six qualifying companies. Within autos, Asia-Pacific Mechanical & Electrical, Lintai New Materials, and Ninebot Limited all reported net profit growth lower bounds exceeding 50% for 2025.

Comparing 2025 net profits to figures from five years prior, 49 companies saw profits double, 14 experienced growth exceeding fivefold, and six achieved more than tenfold increases, including Asia-Pacific Mechanical & Electrical, Ninebot Limited, Taishan Petroleum, Bojun Technology, Batian Ecological, and Zhongji Innolight.

Zhongji Innolight, a leader in optical modules with a market capitalization over 600 billion yuan (ranking second in the communications industry), reported a 2025 net profit of approximately 9.8 billion yuan, with a year-on-year growth lower bound near 90%, setting a new record. The company credited strong customer investment in computing infrastructure, rapid shipment growth, an increasing proportion of high-speed optical modules, optimized product solutions, and improved operational efficiency for significant revenue and profit increases.

Bolstered by solid earnings, these companies generally demonstrated strong stock performance. As of February 6, 2026, the 62 firms averaged nearly an 8% year-to-date gain, significantly outperforming the broader market. Eleven companies saw increases exceeding 20%, including several from the non-ferrous metals sector.

CaiBai Co., Ltd. in textiles and apparel, along with Hunan Gold and Xiamen Tungsten from non-ferrous metals, each gained over 35% year-to-date. CaiBai surged more than 71%, with 2025 net profit forecasted at no less than 1.06 billion yuan, up over 45% year-on-year, attributed to accelerated consumption trends in the gold and jewelry sector. Its 2025 profit increased more than 190% compared to five years ago.

Hunan Gold rose over 70% year-to-date, with 2025 net profit growth projected at least 50%, and a five-year increase exceeding 460%. Xiamen Tungsten and Zhongjin Gold both gained over 25%, with their 2025 profits rising more than 200% compared to 2020 levels.

Further analysis shows that nearly 20 of the 62 companies received institutional research visits since the start of 2026, with 13 firms attracting attention from over 12 institutions. Ninebot Limited, Zhongji Innolight, and Bank of Nanjing were each researched by more than 75 institutions.

Ninebot Limited was visited by 160 institutions, stating sufficient preparation in product reserves, channel synergy, and compliance readiness, expressing confidence in navigating industry adjustments for a stable start. Zhongji Innolight received 137 visits, noting many customer orders extending into the fourth quarter of 2026, reflecting high and sustained industry demand.

Bank of Nanjing was researched by 76 institutions. Its 2025 net profit reached 21.807 billion yuan, a more than 65% increase from 2020. The bank aims to maintain steady growth in 2026 while optimizing credit structure, carefully managing lending pace, deepening regional market presence, and strengthening risk management to ensure balanced credit business metrics and support regional economic development.

CaiBai Co. received 51 institutional visits, planning to enhance product structure, deepen IP collaborations, and improve shopping experiences to capitalize on holiday consumption opportunities like New Year's and Spring Festival, boosting sales momentum early in 2026.

Regarding market performance, the 13 heavily-researched companies averaged over a 10% year-to-date gain. However, Ninebot Limited, Bojun Technology, and Zhongji Innolight saw declining share prices, while Sieyuan Electric, Guangha Communications, and Weichai Heavy Machinery each advanced more than 15%.