The rating was downgraded to prudently increase holdings, and the target price was lowered to 11 yuan. Considering that the industry sentiment fell far short of expectations, the company downgraded its EPS to 0.18 (-0.13) /0.28 (-0.13) yuan in 2016-2017, and downgraded its rating to prudently increase its holdings. Considering that the market still has insufficient understanding of the company's resource endowments in the railway sector, the target price was lowered to 11 yuan (-21%), corresponding to 39 times PE in 2017. The main job has reached a freezing point, and squats are just for a better take-off. The company lost 0.18 billion yuan in the first three quarters and 0.19 million yuan in a single quarter in Q3. Among them, due to the cyclical impact of the railway IT industry, the company's main revenue fell -17% year over year. The company's fee rate increased by 12 percentage points over the same period last year, mainly due to investment in new business such as railway customer service and intermediary expenses. The company's main business has reached a freezing point. However, we have determined that next year, Endogenics is expected to return to normal profit levels of 1 to 125 million yuan. On the one hand, according to industry research, vehicle tenders are expected to resume next year. On the other hand, the new business has passed the investment period, and the company's cost growth is expected to slow down next year. In strategic sorting, scarce resource endowments give long-term value. The company previously announced the acquisition of 66.5% of eWeixun's shares in pure cash for 319 million yuan. The target promises no less than 60 million yuan in 2017, which is expected to further provide solid support for fundamentals. Currently, the company's strategic logic is being re-sorted out. Relying on the traditional main business and the target of the acquisition, eWeixun, we judge that the railway scene is still the company's future strategic focus. The company has scarce resource endowments in the railway sector, such as long-term deep partnerships with railway giants such as 12306 and Yicheng. Once execution breaks through, the next strategic curtain is worth looking forward to. Risk warning: Short-term performance pressure under the slump in the industry; the strategic upgrade process falls short of expectations