1. Event Overview On October 27, the company released the full report for the third quarter. The report shows that in the first three quarters of 2016, the company achieved operating income of 1.42 billion yuan, an increase of 97% over the previous year; realized net profit of 308 million yuan, an increase of 276% over the previous year; basic and diluted EPS was 0.23 yuan. 2. Analysis and judgment: In the first three quarters of high growth in performance, big data and Internet education, the company's big data and Internet education sectors both achieved high performance growth, and revenue in the big data sector achieved explosive growth of 9512.22% in revenue, and revenue in the Internet education sector increased by 452.58%. The main reason for the sharp increase in the company's performance is that through deep resource integration and business integration, the competitiveness of the four major business segments continues to increase. At the same time, the performance of Precise Information, Jiedong Control, Chengdu Ophelin, and Connected World is included in the scope of the company's merger. Investing in the Wood Stock Exchange and switching from offline to online brought profit to the company. During the reporting period, the company successively invested in the establishment of Beijing Timber Industry Electronic Trading Center Co., Ltd., Datong Forest Commodity Trading Center Co., Ltd., and Tianjin Yicheng Smart City Research Institute Co., Ltd. Through this move, the company participated in the informatization and subsequent operation of the trading center. Smart city revenue is growing steadily, and future growth is stable. The company has made progress in PPP projects related to social livelihood, and has joined forces with other companies to sign PPP projects for smart agriculture construction in Nanyang City. Through cooperation with state-owned companies, we participate in the construction of a social security monitoring system for the “capital of peace” in the Inner Mongolia Autonomous Region. The subsidiary Donglan Digital continues to carry out research and development work on smart water services and smart party building. The subsidiary uses accurate information to carry out six research and development tasks, including a digital geographical name administration and social service system, a comprehensive military and emergency management system, a smart city integrated management and public service system, an intelligent monitoring and inspection management system for field cultural relics, an underground integrated pipe gallery operation supervision service system, and a comprehensive service system for sponge city construction. Explosive growth in big data business The company is based on the general development direction of the big data sector set at the beginning of the year: providing data analysis services to industry customers, completing comprehensive credit services for enterprises and individuals, public opinion services, precision marketing, etc., to achieve explosive growth in revenue and profit. Internet education has progressed smoothly, and the company has strengthened its advantageous positioning and business integration in the national training network and the connected world. On the basis of ensuring the continuous development of one brand, two platforms, and three businesses, it has launched a mechanical cloud project, which has won some social recognition. During the reporting period, the National Training Network continued to make profits in admissions, vocational research programs, undergraduate programs, specialty programs, employment bureau programs, job training programs, talent entry programs, and psychological training programs; and successfully pioneered overseas study abroad programs. 3. Profit forecasts and investment recommendations maintain the “highly recommended” rating. The company's EPS for 16-18 is expected to be 0.44 yuan, 0.59 yuan, and 0.74 yuan, respectively. Splitting the market value corresponding to the company's four major business profits, the smart city has an estimated net profit of 33-350 million, with a market value of 178-18.9 billion according to the smart city sector average of 54X; the net profit of the big data business is 100 million, and its market value is 5.3 billion according to the average 53X valuation of the big data sector; the net profit of the smart conference business is 140 million yuan; the market value of the online education business is 8.26 billion according to an average valuation of 59X in the e-government business; the net profit of the online education business is 40 million yuan. The net profit of the online education business is 40 million yuan, and its market value is 2.88 billion yuan according to the average valuation of 72X in the Internet education sector. After adding these, the total market value of the company should be 342-35.34 billion yuan, and the corresponding stock price for the next 12 months should be 23.5-24.3 yuan. 4. Risk warning: 1) The development of M&A targets falls short of expectations; 2) the risk of technological innovation.