SINA
Shares of the Chinese new-media specialist popped 8% higher yesterday after the company posted better than expected quarterly results.
It's a familiar place for SINA. It had come through with 13 consecutive quarters of analyst-thumping performances before showing its mortal side earlier this year.
This quarter was a beauty.
Dismiss the 15% top-line growth and the reported profit of $0.37 a share, more than double last year's first-quarter earnings. The top-line increase understates reality, just as the bottom line overstates it.
SINA combined its Web-based realty advertising business with some of E-House's
SINA's non-GAAP results clear up the picture. Net revenue climbed 19%, propelled by a 47% increase in online brand advertising. SINA's adjusted profit rose 66% to $0.34 a share, well ahead of the $0.27 a share that Wall Street was targeting.
The results compare favorably to peer Sohu.com
SINA's gain pales next to Baidu.com's
The vault is heavy at SINA. The company closed the quarter with $828 million, but it's apparently in no rush to put it to good use. It was already burned when it tried and ultimately failed to acquire public advertising giant Focus Media
SINA is reasonably priced at 26 times this year's projected profit and 20 times next year's target. If it's truly beginning a new streak of analyst-trouncing earnings, those multiples would be lower. If that's the case, the valuation just became that much more attractive.
Given SINA's history of landing ahead of the pros, I like the bulls' chances here.
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