Matters: The company released its three-quarter report: the first three quarters achieved revenue of 819 million yuan, a year-on-year increase of 63.35%, and net profit of 1994 million, a year-on-year decrease of 75%. Comment: The reversal point in the third quarter has been officially confirmed. The company achieved revenue of 509 million yuan in Q3, a year-on-year increase of 146%, and net profit of 90.76 million yuan, a year-on-year increase of 244%; in the first three quarters, revenue of 819 million yuan, a year-on-year increase of 63.35%, and net profit of 1994 million yuan, a year-on-year decline of 75%; the reversal point in the third quarter was officially confirmed. There are sufficient orders in hand, and continued high growth in subsequent performance can be expected. According to the 2018 annual report, the total amount of the top ten unaccepted contracts disclosed by the company was 1,823 million yuan, and the actual amount is expected to be around 2 billion yuan; as of June 30, 2019, according to data from the China Recruitment Network, the company's winning bid orders increased 75% year-on-year (not considering the status of orders from HKUST Li'an); considering the rising prosperity of the Ministry of Emergency Management and the accelerated development of smart city lifelines, we are confident in the growth of the company's orders and performance. The executive equity transfer and employee stock ownership plan have all been completed, and growth momentum and vitality are expected to be fully unleashed. Previously, the asset management plan of the company's executives had received 5.5% of the shares. The previous phase two employees had already bought 2.11% of the shares, and the total shares held by executives and employees was 7.61% of the company's shares. In the context of state-owned holdings, the shareholding ratio of executives and employees is high, which is expected to fully mobilize vitality. 5G infrastructure is gradually improving, and the city's lifeline is expected to be implemented at an accelerated pace. One of the typical application scenarios of 5G is the urban Internet of Things. The company's urban lifeline is “Internet of Things+Platform Software”. The gradual maturity of 5G is expected to accelerate the implementation of the urban lifeline. It has already been established in Hefei, Huaibei, Wuhan, and Xuzhou before, and is expected to land in more cities such as Foshan in '19. Investment suggestion: The inflection point of the company in the third quarter has been established. Considering the abundance of on-hand orders and the continued rise in industry sentiment, it is expected that the future will be even more exciting. We maintain an estimated net profit of 203 million, 306 million, and 462 million yuan respectively from '19 to 21, with corresponding valuations of 47 times, 31 times, and 21 times, respectively. Referring to the valuations of comparable companies, we gave the company a combined PE of 40 times in 2020, raised the target price to 52.5 yuan, and maintained a “strong push” rating. Risk warning: The overseas political and economic situation is unstable; order acceptance progress falls short of expectations.