Inspur Information (000977): Improvement of many operating indicators in the first quarter is expected to enjoy cloud IT investment exceeding expectations
Event: The company released the 2019Q1 quarterly report: achieving operating income of 96.
0.94 million yuan, an increase of 27 in ten years.
31%; Net profit attributable to shareholders of listed companies is 0.
920,000 yuan, an increase of 67 in ten years.
89%; Realize non-recurring net profit attributable to shareholders of listed companies 0.
68 ppm, an increase of 42 in ten years.
Meet market expectations.
Revenue maintained high growth, gross profit margin stabilized, and various operating indicators improved.
1) Operating income for the quarter was 96.
9.4 billion, an annual increase of 27.
31%, which is expected to increase the procurement of downstream Internet customers.
At the same time, the overall gross profit margin for the quarter was 11.
75%, unchanged from the same period last year, verified that the gross profit margin of the server business has stabilized.
2) R & D expenses in this quarter increased by 47 compared with the same period last year.
56%, mainly due to the company’s increased research and development efforts, the increase in the number of new product development and the increase in research and development personnel.
3) Net cash flow from operating activities for the quarter was -10.
570,000 yuan, an increase of 80 in ten years.
56%, which is expected to be due to the improvement in customer repayments.
The domestic cloud computing IT infrastructure investment exceeded expectations, and based on the JDM model and scale advantages, enjoyed the global industry growth dividend.
1) According to the “Quarterly Tracking Report on Cloud Computing IT Infrastructure for the Fourth Quarter of 2018” and “Global Cloud IT Infrastructure Tracking Report for the Fourth Quarter of 2018” issued by IDC, the annual investment of China ‘s public and private cloud IT infrastructure (includingSupplier income and channel bonus): The total investment in 2018 was 120.
1 billion US dollars, an increase of 74 in ten years.
7%, exceeding market expectations; investment is expected to reach 151 in 2019.
700 million US dollars, an annual increase of 25.
2) According to Gartner data, through the advent of IT generations in industries such as AI, the Internet, 5G, edge computing, and enterprise cloud, the global x86 server market in 2018 was strong, with inputs and inputs hitting record highs, with server inputs at 1290.
40,000 units, tellurium is 705.
3 billion US dollars, an increase of 13 each year.
2% and 34.
The company’s JDM model and large-scale advantages are obvious. It can quickly respond to large-scale delivery needs of downstream customers (especially Internet companies) and enjoy the growth dividend of the server industry.
Team up with IBM to develop Power products and accumulate multi-architecture technology foundation.
Under the background of trade friction, the country vigorously promoted the localization of servers to make breakthroughs in the core technology field.
In September 2017, the company and IBM established a joint venture to jointly develop Power architecture servers and combine the advantages of both parties to actively create Power series products, research and development and ecology.
With the three advantages of “steady, fast, and constant” Power servers being accepted by the market, it is expected to eventually 成都桑拿网 increase the gross profit margin of the server business.
Given a target market value of 412 trillion in 2020, maintain a “Buy” rating.
Based on key assumptions and the 2018 annual report, it is estimated that the operating income for 2019-2021 will be 600.
04 billion, 749.8 billion and 922.
2.0 billion, it is expected that the net profit attributable to mothers in 2019-2021 will be 7 respectively.
9.4 billion, 12.
1.2 billion and 15.
That is, the profit CAGR for the next three years is 38%, according to PEG = 0.
9 It is estimated that the target market value for 2020 is 4.12 million yuan, corresponding to PE 34x.
Maintain “Buy” rating.
Risk reminders: growing demand in downstream industries; increased competition in the server industry; escalating trade frictions; and risk of bad debts.