Key investment points:
In April, CITIC computer index fell 16.01%, underperforming the market by 9.70 percentage points and the gem by 3.12 percentage points, ranking 28th among 30 CITIC primary industries. Eight stocks rose, one was flat, 286 fell, and more than 90% fell. On April 29, the TTM overall valuation of CITIC computer industry was 37.04 times, and on April 26, it hit a new low in nearly three years.
Judging from the April market, the overall performance of the computer industry is very weak. We think the reasons behind the performance include:
(1) the impact of the epidemic in 2020 is as follows: in terms of expenditure, listed companies generally reduce the introduction of talents, while the expenditure on sales activities is also reduced due to the impact of the epidemic, and the state has also issued preferential social security policies; In terms of revenue, it is more concentrated in the second half of the year, especially Q4. Under this rhythm, listed companies are relatively optimistic about the market from the end of 2020 to the first half of 2021. In 2021, both equity incentive and talent introduction policies are relatively positive, and the personnel growth rate often exceeds the level of normal years, resulting in the decline of the profitability of a large number of high-quality companies in 2022.
(2) under the influence of the epidemic at the end of 2021 and 2022, the bidding, implementation and payment collection of some projects have been affected, and the anti epidemic has brought uncertainty to the financial expenditure. As Q4 has been the high point of industry revenue recognition over the years, the impact of the epidemic in Q4 has exacerbated the uncertainty of the annual report.
(3) at the end of 2021, the high base of personnel superimposed the impact of the epidemic in 2022 on income. In the first quarterly report of 2022, the decline of performance and increase of losses of computer industry companies have become the norm. In addition, investors lack confidence and pay more attention to profits, further amplifying their pessimism about the industry.
In May, we believe that the market has strong upward momentum:
(1) the epidemic situation in Shanghai is gradually improving, and the follow-up economic activities are expected to recover gradually;
(2) the meeting of the Political Bureau of the CPC Central Committee released good news, and the landing policy is expected to be gradually introduced;
(3) according to the industry data, the impact of the epidemic in 2022 on the growth rate of Q1 is far less than that in 2020q1.
Sub industry: it is suggested to focus on industrial software and network security with high prosperity.
Recommendations for individual stocks: Thunder Software Technology Co.Ltd(300496) ( Thunder Software Technology Co.Ltd(300496) ), Beijing Kingsoft Office Software Inc(688111) ( Beijing Kingsoft Office Software Inc(688111) ), Guangzhou Sie Consulting Co.Ltd(300687) ( Guangzhou Sie Consulting Co.Ltd(300687) ), Venustech Group Inc(002439) ( Venustech Group Inc(002439) ).
Risk warning: uncertainty of international situation; The upper reaches of enterprises cut spending under inflation; Local debt risk release; The epidemic development exceeded expectations.
