Programmed purchasing, mobile marketing and content marketing lead the growth of Internet advertising in 2013-15 years. The three-year compound growth rate of Internet advertising is 38%. Programmed purchasing, mobile marketing and content marketing have become important engines. We counted the A-share M & A target and the new third board target, and the profit growth in 2015 in the areas of programmed purchase, mobile marketing, film and television implantation and film and television content marketing segment reached 43.5%, 234%, 331% and 585%, respectively.
Firmly transform the digital marketing industry and achieve high performance growth
The company began to transform the digital marketing industry in 2013. the first stage: completed the acquisition of Manku, Argon, Krypton and Amber, and established its leading position in integrated marketing. Internet integrated marketing ranked in the second stage of TOP6; from 2014 to 2016: expanding the entrance of traffic and expanding the export of digital marketing. by 2016, the proportion of digital business has rapidly increased to 73%. The compound growth rate of revenue from the 2014-2016 digital sector is as high as 134%. Excluding the consolidation factor, the target of mergers and acquisitions in digital marketing grew by 21% in 2016, and the underlying companies exceeded their performance commitments (excluding restricted stock amortization costs).
Strategic upgrade to enter the field of content marketing and content production
In 2016, the company began to layout the interactive entertainment section, successively invested in century Kunpeng and midsummer starry sky, and set up Leo Yuanli and Leo Xin Xin to cultivate in vitro. Century Kunpeng has integrated more than 700 quality content producers across the country and has more than 100 well-known brands to serve customers. Benefiting from the "1 billion clicks" era of online content traffic, the business model of the combination of film and television implantation and content production continues to upgrade; the company cuts into the field of content marketing and content production to enjoy the development dividend of the industry.
The business is moving to the mobile end, and the digital marketing technology upgrading is imminent. Through the layout of the minimally invasive era (mobile marketing agent) and Wansheng Weiye, the company has opened up the mobile and PC digital marketing industry, and actively transformed to high-growth mobile marketing business. The proportion of mobile traffic integration business of Wansheng Weiye has been increasing continuously in 2013-16. In 2016, mobile traffic integration business has reached 3.2 times that of PC traffic integration business, and the revenue scale has reached 650 million. At the same time, the company plans to issue nearly 3 billion convertible corporate bonds in the near future to strengthen its marketing technology layout, and participate in investing in Leo CDH M & A Fund (with a total size of 8 billion), which will be used for mergers and acquisitions of overseas Internet technology companies in a stable growth period; we believe that the company is expected to further enhance its technological strength.
Profit forecast
It is predicted that the EPS of the company in 2017-19 is 0.47, 0.58 and 0.72 yuan respectively, corresponding to the times of PE in 28-22-18. Target price 15 yuan (corresponding to 32 times dynamic PE in 2017), "buy" rating.
Risk hint: integration risk, M & A target performance is not up to expectations.