Recently, the company's product, the 10-inch smart home control screen Ultra, won the Paris DNA Design Award and the London Design Gold Award for its innovative design and excellent performance. The company's innovative businesses such as smart terminals and brainwave interaction are progressing smoothly, the prospects are good, and the purchase rating is maintained.
Key points to support ratings
Jointly created a smart ward with Huawei and won the Ecological Development Contribution Award. According to the company's WeChat account, since successfully signing a contract with Huawei in 2022, it has actively cooperated with Hongmeng Systems to promote localized solutions in the field of smart hospitals, and has achieved functions such as data interconnection and multi-screen linkage response. At the 2024 Huawei Developers Conference, the company, as an important partner in the field of OpenHarmony smart hospitals, unveiled the entire smart ward line of OpenHarmony products to showcase innovative application practices in the localization of smart wards.
The brain-wave interaction layout is deepening, and smart products are leading a new direction of growth. According to platform information such as Interactive Easy, the company seizes good development opportunities in the brain-wave interaction industry and carries out forward-looking technical research and layout in the field of brain-wave interaction, focusing on research and development in the three segments of sleep quality, training, and rehabilitation devices. According to a report by Pengbai, at the 2024 China Brand Day exhibition held in Shanghai, the company showcased an “intelligent insomnia treatment device” that can analyze and “read” brain waves and improve sleep by releasing low-frequency magnetic pulses. The company's in-depth layout in the emerging field of brain-wave interaction may become a new growth point in the future.
The share repurchase is progressing smoothly, showing confidence in future development. According to the company's announcement, on February 5, 2024, the company plans to use 4,000 to 60 million yuan to repurchase shares for share incentives or employee stock ownership plans; as of July 31, 4,729,040 shares have been repurchased, accounting for about 1.88% of the total share capital, costing about 43.175 million yuan (not including transaction fees). Active buybacks reflect management's approval of the company's prospects.
valuations
Net profit due to mother from 2024 to 2026 is estimated to be 1.6, 190 million yuan, and 210 million yuan (taking into account the impact of the company's low base in the first quarter, a reduction of 33%-38%), EPS is 0.64, 0.74, and 0.82 yuan, and corresponding PE is 13X, 11X, and 10X, respectively. The company's innovative businesses such as smart terminals and brainwave interaction are progressing smoothly, the prospects are good, and the purchase rating is maintained.
The main risks faced by ratings
Customer demand falls short of expectations; business development falls short of expectations; technology research and development falls short of expectations.