I. Overview of events
The company released its quarterly report for 2021 on April 27, 2021, with revenue of about 367 million yuan, an increase of 66.68 percent over the same period last year, and net profit of about 11.09 million yuan, an increase of 355.68 percent over the same period last year.
II. Analysis and judgment
The revenue growth rate of more than 60% reflects the business magnanimity, and the profit end turns from loss to profit growth rate of more than 300%. The company's revenue side maintains a high growth rate, and the 19Q1-21Q1 compound growth rate reaches 50%, reflecting the rapid development of the business. In terms of specific business, the digital painting business benefits from the new brand strategy, cross-border e-commerce layout and the promotion of overseas channels, and its revenue growth rate is higher than the year-on-year growth rate of the national cross-border e-commerce sector in the first quarter of 2021; text big data and service business revenue in areas such as smart politics and law increased compared with the same period in 2019 and the first quarter of 2020.
At the profit end, gross profit margin and net profit margin have increased significantly, promoting a high performance. The company's gross profit margin continued to optimize, about 5 percentage points higher than the same period last year, while sales and other expenses continued to optimize, driving the overall net profit increased by about 9 percentage points.
With the continuous improvement of overseas marketing ability, drawing boards and other business have achieved good performance overseas, and have been sold in more than 20 third-party cross-border e-commerce platforms such as Amazon and e-Bay and 15 self-built stations, and a number of products have been rated as "Bestseller" by Amazon.
In terms of capacitive pens, in 2020, the company's capacitive pens products and solutions gradually opened up the market at the B end, made continuous breakthroughs in the mobile phone field, and won domestic well-known first-class brand recognition; paperless office, intelligent applications and other aspects, the company won a number of B-end customers. According to the company's disclosure, the revenue of big data and the service business in the areas of wisdom, politics and law increased compared with the same period in 2019 and the first quarter of 2020, and the recovery of related business is expected to become an important basis for the company's growth. Continuous breakthroughs in new fields such as capacitor pens are expected to bring long-term impetus to the company's development.
III. Investment suggestions
The company's painting business continues to grow to verify its own strength, while consumer electronic pens and other businesses have long-term potential. It is estimated that the return net profit of the company from 2021 to 2023 is 1.75 million yuan, 2.51 billion yuan, 0.72 and 1.03 million yuan, respectively, and the corresponding PE is 26x, 18x and 15x, respectively. Select the Wind artificial intelligence section, the related companies' average PE in 2021 is 28X (Wind consensus expectations), the company's current valuation is slightly lower than the industry average, considering that the company's performance is expected to continue to grow high, and is a leader in the field of artificial intelligence vision, maintain the "recommended" rating.
Fourth, risk tips:
Overseas business is not as expected, and the expansion of the traditional field of artificial intelligence is not as expected.