Main points of investment

What happened: the company released its three quarterly reports for 2016.

Comments:

Benefiting from the consolidation effect, 16Q3 performance maintained high growth. 1) the company's 16Q3 realized operating income of 784 million yuan, an increase of 186% over the same period last year; net profit of 34.23 million yuan, an increase of 399% over the same period last year; revenue of 2.08 billion yuan from January to September 2016, an increase of 221% over the same period last year, and a net profit of 147 million yuan, an increase of 746% over the same period last year, in line with market expectations (the company expects a net profit of 1.3-160 million yuan from January to September). 2) on the one hand, the growth of corporate performance comes from the consolidation effect of digital marketing subsidiaries, on the other hand, the profits of subsidiaries are growing rapidly. 3) the company expects the annual net profit in 2016 to be 1.535-191 million yuan.

The performance of mobile hardware import marketing is gratifying, and the endogenous development is good. The company ranks among the best in several major domestic mobile phone agents: vivo becomes the largest core agent in the network service industry in the sub-industry bidding, oppo becomes the core agent in the e-commerce financial industry in the sub-industry bidding, and becomes the core agent in XIAOMI's home-keeping industry; at the moment when the mobile hardware entrance is becoming more and more important, the company keenly grasps the wind direction of the times and ensures the high-speed growth of the endogenous direction.

Profit forecast and rating: the annual net profit of the company in 2016-17-18 is expected to be 178x222max 247m, the fully diluted EPS is 0.24max 0.30pm 0.34, and the current share price corresponding to PE is respectively times that of 75-60-54. We are optimistic about the two-wheel drive of the company's extension M & An and endogenous development, the synergy between subsidiaries, and the company's determination to focus on digital marketing strategy, and look forward to the company continuing to improve its mobile marketing layout through extension in the future. maintain a "buy" rating.

Risk hints: acquisitions fall short of expectations; macroeconomic downside risks.