Minsheng Securities Co., Ltd. Ma Tianyi and Ma Jiawei recently conducted research on Tianfu Communications and released a research report "Comment on the 2022 Semi-annual Performance Express: Performance meets expectations, and demand in the digital communication field builds growth driving force". This report gives a buy rating for Tianfu Communications, with the current stock price of 27.72 yuan.
Tianfu Communications (300394)
Event Overview: On July 18, the company released its 2022 semi-annual performance report, with revenue expected to reach 577 million yuan in the first half of the year, a year-on-year increase of 17.9%, and a net profit attributable to shareholders of RMB 174 million, a year-on-year increase of 26.1%, and a net profit attributable to shareholders of RMB 155 million after deducting non-operating items, a year-on-year increase of 22.2%. Judging from the Q2 single quarter, it is expected to achieve revenue of 295 million yuan, a year-on-year increase of 19.6%, a month-on-month increase of 4.2%, and a net profit attributable to shareholders of 91 million yuan, a year-on-year increase of 34.4%, and a month-on-month increase of 9.7%.
The high prosperity of digital communications field drives the growth of demand for optical devices and builds an important driving force for the company's performance growth: downstream cloud computing customers' capital expenditure is high, and the prior indicator of prosperity is Xinhua's revenue data has maintained a year-on-month double growth for many consecutive months, of which 8.5% month-on-month increase in June, 53.7% year-on-year increase, and 54.6% year-on-year revenue in the first half of the year. These are strong evidence of the high prosperity of digital communications field. The continued high growth of data center traffic drives the customer side to accelerate the deployment of high-end optical modules such as 200G and 400G to achieve transmission rate upgrades. This is the main reason for the high prosperity of digital communications. Currently, many optical device products of the company are adapted to high-end optical modules such as 200G and 400G. As the demand for optical modules increases, it has effectively driven the growth of product demand for multiple optical device product lines of the company. Therefore, in the case of severe epidemic situation in the first half of the year, the company still achieved a year-on-year growth of 17.9% and 26.1%. At the same time, the high demand in the digital communication field has also promoted the company's overseas revenue to continue to increase (the company's overseas revenue accounted for 50% in 2021). Since exports are mainly settled in US dollars, benefiting from the positive exchange rate in the first half of this year, it also has a certain positive impact on the company's performance.
high-speed optical engine business is progressing smoothly and will continue to provide positive contributions to performance: the company's 2021 fundraising and investment project "High-speed optical engine construction project for 5G and data centers" is committed to vertically integrating the company's existing active and passive optical devices and developing a one-stop integration solution for optical transceiver engines. The overall progress is smooth. In the first half of this year, it was in a stable mass production stage, and revenue achieved year-on-year growth. According to the announcement, the company is currently expanding its second phase of production capacity and is expected to continue to increase in the second half of the year. With the continuous increase and release of production capacity, it is expected to provide positive contributions to the company's performance.
lidar field is accelerating and further opening up the company's future growth space: in the field of lidar, the company relies on the optical device research and development platform that has been built for many years, and uses its accumulation in basic materials and components, optical design, integrated packaging and other fields, focusing on providing matching optical device products and active packaging products for downstream lidar manufacturers. It is currently steadily advancing cooperation with multiple lidar customers. The overall progress is promising and is expected to further expand the company's growth space in the future.
Investment advice: We expect the company's net profit attributable to shareholders from 2022 to 2024 to be RMB 425/545/682 million, respectively, and the corresponding PE multiple is RMB 24X/19X/15X. As a scarce one-stop solution provider of platform-type optical devices in China, the company has strong traditional passive business strength, and the synergistic effect of active and passive devices business is obvious. With the continuous increase in the proportion of overseas revenue, the large-scale production of high-speed optical engine projects, and the acceleration of emerging cross-field businesses, the company is full of growth momentum. Maintain a "recommended" rating.
Risk warning: The market demand for downstream traditional telecommunications/monitors is lower than expected, and the expansion of new application fields is lower than expected.
Securities Star Data Center calculates based on the research report data released in the past three years, Guosheng Securities' researcher team has conducted in-depth research on the stock, with the average prediction accuracy in the past three years as high as 91.43%. It predicts that the attributable net profit in 2022 will be a profit of 421 million yuan, and the predicted PE based on the current price conversion is 23.98.
latest profit forecast details are as follows:
A total of 17 institutions in the stock have given ratings in the past 90 days, 14 buy ratings and 3 increase ratings; the average target price of institutions in the past 90 days was 26.88.According to the financial report data in the past five years, Securities Star valuation analysis tool shows that Tianfu Communications (300394) has average competitiveness in the industry, good profitability, and average revenue growth. Financial health is relatively healthy, and financial indicators that need to be paid attention to include: accounts receivable/profit margin. The stock has a good company index of 3.5 stars, a good price index of 2.5 stars, and a comprehensive index of 3 stars. (Indicators are for reference only, indicator range: 0 ~ 5 stars, maximum 5 stars)
or above is compiled by Securities Star based on public information. If you have any questions, please contact us.
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