The vanguard of anti-epidemic, showing a beautiful performance.
The company released its annual report on August 21. 1H20 achieved an income of 503 million yuan (yoy+33.03%), a net profit of 105 million yuan (yoy+137.25%), and a net profit of 99 million yuan (yoy+152.64%), of which 2Q20 income and net profit increased by 16.94% and 41.08% respectively over the same period last year. The year-on-year growth rate of 1H20 net profit is significantly faster than that of revenue, which we expect to be related to the increased share of high gross margin products such as mobile DR and lower expenses such as travel during the epidemic. We maintain our profit forecast and expect the company's 20-22 EPS to be 0.440.51 pound 0.62 yuan, adjust the target price to 19.08 yuan (previous value 18.19-19.08 yuan), and maintain the "buy" rating.
The rate of sales and management expenses decreased compared with the same period last year, and the cash flow improved significantly.
The company's 1H20 gross profit margin is 55.99% (yoy+9.12pct), and the rates of sales, management and R & D expenses are 18.5% (yoy-0.2pct), 7.4% (yoy-1.7pct) and 9.0% (yoy-0.4pct). The net cash flow of 1H20 operating activities was 145 million yuan (yoy+214.02%), and the cash flow improved significantly.
Anti-epidemic products Mobile DR and DR perform well
1) Mobile DR: mobile DR 1H20 achieved 185 million yuan in revenue, which is several times higher than the same period last year. We expect the number of confirmed revenue units in the first half of the year to be 400-500 units, and the annual sales volume is expected to reach 800-1000 units (70-80 units per vs19 year). 2) fixed DR: sales increased significantly during the epidemic, and we expect 1H20 fixed DR revenue to be 600-800 units. Considering that the grass-roots collection targets are generally concentrated in the second half of the year (especially in the fourth quarter), we are optimistic that DR will continue the trend of rapid volume expansion in the second half of the year and is expected to achieve sales of more than 2000 units in the whole year.
MRI, CT, DSA and other month-on-month recovery, Wanliyun orderly advance
1) MRI: we expect 2Q20 sales to improve month-on-month, in which superconductor recovers quickly and permanent magnets continue to catch up; 2) CT: small volume, in the rapid release stage, we expect to achieve sales of more than 30 units for the whole year; 3) DSA: under the background of cancellation of configuration certificate and upgrading of county-level hospitals, DSA ushered in a volume opportunity, and we expect sales to achieve steady growth in the past 20 years. 4) Ultrasound: 1H20 has been approved 3 series of products, and we expect to be approved 3 more series of products this year, contributing new increments; 5) Wanliyun: online and offline business is progressing smoothly, 1H20 achieves a net profit of 1.27 million yuan.
Medical equipment leaders entering the harvest period maintain the "buy" rating and we maintain the profit forecast. The company's 20-22 net profit is expected to be 2.40 yuan 2.77 billion yuan, an increase of 42%, 15%, 20%, and the current share price corresponds to the 20-22 PE valuation 35x/31x/25x.
The company is a leading medical equipment supplier in China, with a complete product layout. Considering that compared with comparable companies, the compound growth rate of homing net profit in 20-22 years is slightly lower (25% VS is 39% of the average company average). We give the company a 20-year PE valuation of 43x (comparable company's 20-year Wind consensus expected average PE valuation of 48x), and adjust the target price to 19.08 yuan (previous value 18.19-19.08 yuan) Maintain a "buy" rating.
Risk hint: product structure single risk, competition aggravates risk, product price reduction risk.