A leading company in the field of identity security and endpoint security, with a “buy” rating for the first time
The company is a leader in the cybersecurity software market in China, and is a cybersecurity company that “knows the Internet and the cloud” in the industry.
We expect the company's 2024-2026 net profit to be 0.15, 1.32, and 185 million yuan, EPS 0.04, 0.33, and 0.46 yuan/share, respectively. The current stock price corresponds to PE 397.1, 44.5, and 31.6 times, respectively. The company's valuation is higher than the average valuation level of comparable companies. Considering the company's leading position in the field of network software, it is expected to make important breakthroughs in the fields of cloud security and AI security in the future, giving it a “buy” rating for the first time.
Benchmarking leading international network security companies, products such as identity security, endpoint security, situation awareness, terminal security detection and response (EDR), threat intelligence, and cloud hosting security are all in a leading position in the industry at the level of platform advantage cards and intelligent product linkage products. At the same time, against leading international cybersecurity companies such as Trend Micro, CrowdStrike, and Palo Alto, the company launched the Trust One terminal security platform and XDR integrated security platform, providing a complete solution with product sub-capabilities+platform capabilities+expert services, which can both satisfy localized deployment and support SaaS deployment.
Endogenous+outreach to promote the integrated development of cloud network security
(1) Acquire security dogs and strengthen the layout of the cloud security field. In October 2023, the company acquired 75.96% of Xiamen Fuyun Information Technology Co., Ltd. Through this acquisition, the company and Servyun Information will deeply integrate cloud security product technology capabilities, accelerate the innovation and development of cloud-native security, and build a complete cloud security product system.
(2) It is proposed to acquire ASIX Technology to further open up the integrated strategy of cloud network security. In January 2024, the company announced a major asset restructuring plan. It plans to hold ASIX Technology, which has accumulated a deep presence in the operator market. Through this transaction, the company will further build a “understand the Internet, understand the cloud, and understand security” capability, enhance the “cloud network security” integration capabilities, extend and enhance the product line, and enhance the overall solution strength.
Risk warning: risk of declining industry growth rate; risk of losing core technical personnel; risk of developing new products.