Foxit Software(688095) 国泰君安·2024-11-04 07:26Investment Rating - The report maintains a "Buy" rating for the company, with a target price raised to 81.16 CNY from the previous 62.71 CNY [6][12][24]. Core Insights - The company's subscription transformation is progressing smoothly, with a continuous increase in revenue share. The optimization of the commercial revenue model, combined with solid advancements in overseas markets, suggests that future performance growth may exceed expectations [4][12]. - For the first three quarters of 2024, the company achieved a revenue of 509 million CNY, representing a year-on-year growth of 15.07%. After adjusting for currency fluctuations, the growth rate is approximately 14.02% [12]. - The company's net profit attributable to shareholders for the first three quarters was 38.67 million CNY, a significant increase of 163.07% year-on-year, although adjusted figures indicate a loss due to integration challenges from recent acquisitions [12][19]. Summary by Sections Financial Performance - The company reported a revenue of 5.09 billion CNY for the first three quarters of 2024, with a notable increase in subscription revenue, which reached 2.45 billion CNY, accounting for 48.07% of total revenue, up 65.77% year-on-year [12][19]. - The annual revenue forecast for 2024-2026 is projected at 6.75 billion CNY, 7.85 billion CNY, and 8.95 billion CNY respectively, with net profits expected to be -0.11 billion CNY, 0.27 billion CNY, and 0.67 billion CNY [19][20]. Business Model and Strategy - The core product lines, particularly the PDF editor and reader, are expected to maintain a revenue contribution of over 70%. The company is focusing on integrating cloud services and enhancing its product offerings, which is anticipated to drive revenue growth [18][22]. - The subscription model is showing positive results, with the annual recurring revenue (ARR) reaching 366 million CNY, a growth of approximately 46.30% compared to the previous year [12][19]. Market Position and Valuation - The report suggests a valuation based on EV/Sales and PS methods, with a target price of 81.16 CNY, reflecting the company's strong market position in the PDF and related software sector [24][27]. - The company is positioned as a leader in the domestic PDF market, with significant growth potential in subscription revenue and channel transformation efforts [24][27].