I. Overview of events
The company released the second phase of the employee stock ownership plan, senior executives and middle-level and core backbone 300 people plan to raise 50 million yuan, accounting for about 0.91% of the total share capital.
II. Analysis and judgment
The chairman of the board protects the capital and the enthusiasm of the staff is further enhanced.
In order to strengthen the long-term incentive effect for the core employees and realize the benefit sharing between the company and the employees, the employee shareholding is guaranteed by the chairman of the board of directors with an annualized rate of return of 3%, demonstrating the management's confidence in future growth.
The iMac project is progressing smoothly and will contribute flexible performance next year.
Mass production began in early October and is now in a critical stage of good rate climbing. At present, 70% of the good rate has begun to break even, and some colors have reached more than 80%. The yield is expected to be further improved, and the net interest rate will continue to rise. We expect to ship 1 million sets next year, which is estimated to contribute 150 million of the profit increment. It is expected that the future 27-inch iMac will also adopt a new design, we judge that Corson is likely to participate.
The product reserve is abundant, which is enough to support the development for more than 3 years.
The market believes that Cossen's long-term growth logic is lacking, and we believe that the company's current product reserves are rich enough to support more than 3 years of development: 1) A customers, from iPhone frame to iMac shell to Macbook shaft and shell; 2) Huawei customers, from laptop shell to hinge shell to watch shell and headset metal parts, Cosen aims to become an one-stop solution provider for consumer electronics metal parts.
III. Investment suggestions
It is estimated that the company's operating income in 2020-22 will be 100 million yuan in 32-41-51, and the return net profit will be 1.1 billion yuan, corresponding to the valuation of 50-15-12, with reference to SW Electronics' latest TTM valuation of 54 times in 2020-12-29. Taking into account the rapid growth next year, we believe that the company underestimates and maintains the "recommended" rating.
Fourth, risk tips:
The risk of market competition, the risk of new product research and development, and the risk that the company's performance fluctuates with the upgrading of downstream products.