Key investment points: “Full Course Cloud+ and Education” dual platforms are being promoted, and endogenous growth is steadily improving. The home-school interactive upgrade business is based on post-investment collaboration and product superposition, with rapid revenue growth. It is expected that 2016 will continue to maintain significant steady growth, and the robustness of the business and revenue structure will increase significantly; the company's focused EDSaaS business, from strategic layout to large-scale promotion period, has significant revenue growth, and is expected to grow several times year-on-year in 2016; continuing education business, revenue and profit performance in the first three quarters of 2016 is better than 2015. We expect Quantong Education to successfully complete the 2016 annual performance of 85 million yuan Commitment (imputable net profit after deducting non-compliance). Overall, considering that the continuing education business and the EDSaaS business are somewhat seasonal, the company's profit is expected to increase significantly in the fourth quarter. The merger and acquisition will be suspended until full preparations are made, and the trend of extension expansion will not be changed. On August 15, 2016, the company suspended trading to acquire assets in the education information service industry. The estimated transaction amount is between RMB 2.8 billion and RMB 4 billion. Since this major asset restructuring matter is subject to the regulatory requirements of the Shenzhen Stock Exchange's new regulations on the suspension and resumption of trading, the amount of assets is large, and the valuation of the underlying asset is still in the stage of verification, consultation and negotiation. Due to prudential considerations, the company temporarily terminated the restructuring matter, but related matters are still in progress. After the transaction conditions are ripe, the company will choose an opportunity to initiate related matters depending on the specific circumstances. Judging from history, the company actively promotes the integration of external mergers and acquisitions with internalization. In the future, it is expected that subsequent growth will be steadily promoted through synergy between the main business and the company of external tenders. Investment advice and performance forecast: The company is a leading K12 online education company in China. Its business focuses on the field of education and is scarce to a certain extent. Three major future highlights: 1) Invest in China online to obtain scarce data portals, enhance the value of education services, and consolidate the company's leading position in the industry; 2) grasp core education data, build a solid foundation of high-quality content, provide collaboration for the existing four major business groups, enhance ARPU value, and significantly increase performance; 3) deepen the cooperation between the company and top domestic institutions, and there are strong expectations for continued external development in the future. Based on the profitability of the Continuing Education Network, the company's huge future development space, and the high degree of synergy between business segments, we expect the company's 2016-2018 EPS to be 0.37 yuan, 0.63 yuan, and 0.75 yuan, respectively. Considering that the company will enter the fast track of traffic monetization, it will continue to deepen the online education layout in the future, and the valuation should increase accordingly; at the same time, the current high revenue growth rate is in line with expectations. Referring to the PE level in the same industry, considering the company's leading edge in the industry and high growth, we gave the company a valuation of 100 times in 2016, corresponding to the target price of 37.00 yuan, and maintained the buying rating. Risk warning: transformation falls short of expectations; risk of declining profitability; risk of economic downturn.