Event: the company issued a 16-and-a-half-year performance forecast with an estimated net profit of 3200-37 million, an increase of 65% over the same period last year.
Main points of investment:
The performance increased significantly in the first half of the year, and the reversal was established for the whole year. The company's net profit fell to 7 million after 15 years due to the decline of IC's old business and the lack of new growth points such as education and data security. In the first half of 16 years, the company's net profit increased significantly compared with the same period last year, mainly due to the large increase in sales and revenue of terminal products in the data security business compared with the same period last year.
Mobile terminal data security potential, landing Coolpad and TCL mobile phones, Niudao pilot test.
The company is the first batch of domestic manufacturers engaged in mobile phone security services, and the corresponding products and solutions are: TAThing, TCore, SE, Letspay, etc., supporting the mainstream mobile phone security technologies such as TEE, eSE, TSM, Token, HCE, etc. In 2016, with the gradual popularity of mobile phones loaded with fingerprint identification modules, ApplePay led domestic mobile phone manufacturers to emulate the progress of mobile phone pay. We are optimistic about the larger space and potential, waiting for the outbreak of the mobile phone security service market represented by TEE.
So far, subsidiary Guoko Technology has landed two mobile phone manufacturers, Kupai and TCL, which will provide a safe environment for mobile phone users when they pay for Alipay or WeChat Pay.
Education cloud platform has the first market share, horse racing enclosure. The company has undertaken the construction, operation and maintenance / operation of regional education cloud platform in 30 provinces / cities. In recent years, the company will continue to expand the coverage area, and strengthen the service to the school operation. The industry relies on policy-driven funding and the deepening of educational IT services. The company has the advantage of first mover, and the greater expectation in the future is that the revenue will be expanded in terms of cloud platform services, core applications and resource services.
Solid out of the trough, looking forward to education, mobile security terminal business important inflection point to come. At present, the company focuses on "education" and "mobile terminal security". The space is large and the industry has just started. However, considering that it will take time for the above-mentioned business volume, we slightly raised the EPS in 16-18 to 0.13, 0.28 and 0.42 yuan, temporarily maintaining the "recommended" rating, and maintaining the target price to 18.9 yuan, corresponding to 45 times PE in 18 years.
Risk hints: the price of financial IC card products continues to decline and sales fall short of expectations; the market expansion of online education business falls short of expectations; and the uncertainty of the promotion of terminal security products such as TEE on mobile phones.