Foxit Software(688095) 国泰君安·2024-09-03 07:43Investment Rating - The report maintains a "Buy" rating for the company, with a target price adjusted to 62.71 CNY [4][5]. Core Insights - The company's revenue growth has accelerated, showcasing the effectiveness of its dual transformation strategy focused on subscriptions and channels. The overseas business continues to grow significantly, and with the completion of recent acquisitions, the domestic document sector and vertical markets are expected to see accelerated growth [3][4]. Summary by Sections Financial Performance - In the first half of 2024, the company achieved a revenue of 338 million CNY, representing a year-on-year increase of 17.99%. After adjusting for foreign exchange fluctuations, the growth rate stands at 15.97%, marking a significant improvement compared to the revenue growth rates in 2022 and 2023 [4]. - The net profit attributable to the parent company was 62.52 million CNY, which includes an investment income of 103.32 million CNY from the acquisition of shares in Fuxin Kunpeng. Excluding non-recurring gains and losses, the net profit attributable to the parent company was -63.77 million CNY, a narrowing of losses by approximately 14.58% compared to the previous year [4]. Strategic Transformation - The dual transformation strategy has shown significant results, with subscription revenue reaching 155 million CNY, accounting for 45.81% of total revenue, and growing by 67.83% year-on-year. The Annual Recurring Revenue (ARR) for subscription services reached 325 million CNY, a growth of about 29.90% from the end of the previous year [4]. - The company has made notable progress in its channel transformation, with channel-derived revenue reaching 130 million CNY, representing 38.61% of total revenue and a year-on-year increase of 43.06% [4]. Market Position and Outlook - Following the acquisition of shares in Fuxin Kunpeng, the company has embarked on a new journey in the domestic PDF and OFD document business, enhancing its influence and competitiveness in various vertical markets. The North American market remains a significant revenue source, with subscription revenue increasing by 64.87% year-on-year, and the European and American markets seeing a 121% increase [4]. - The company is expected to achieve further acceleration in main revenue as the dual transformation continues to progress [4]. Earnings Forecast - The company forecasts revenues of 675 million CNY, 785 million CNY, and 895 million CNY for 2024, 2025, and 2026, respectively. The net profit attributable to the parent company is projected to be -30 million CNY, 16 million CNY, and 54 million CNY for the same years, with EPS of -0.33 CNY, 0.18 CNY, and 0.59 CNY [13][15]. Valuation - The report employs both EV/Sales and PS valuation methods, predicting a reasonable market value of 57.38 billion CNY for the company, corresponding to a target price of 62.71 CNY based on an 8.5x PS ratio for 2024 [19][20].