The metamorphosis of iQiyi (NASDAQ:IQ) into a monster growth stock continues. Shares of China's leading streaming video service rose 25.4% last week, its strongest gain in its brief, but now quite lucrative, history as a publicly traded company. The stock has now posted back-to-back weeks of double-digit percentage gains

Momentum finds iQiyi coasting higher, but it also was the beneficiary of a bullish analyst initiation on Thursday. Citic Securities kicked off its coverage of the stock with a buy rating and a $28.33 price target.

Citic's price goal is currently the highest among Wall Street analysts. iQiyi's surge would result in the stock closing out the week just ahead of $28.33, a problematic development perhaps -- but more than likely a dinner bell for earlier analysts to jack up their price targets unless they're willing to bet against the stock's hearty momentum. 

iQiyi app on a mobile phone.

Image source: iQiyi.

From zero to hero

Last week's bullish analyst initiation and the market's favorable reaction a week earlier to iQiyi opening its first "Yuke" on-demand cinema are sending the shares to fresh all-time highs, but the event that set all of these gains in motion likely was the dot-com darling's first-quarter report in late April. iQiyi's first financial update since its late March IPO was a model-affirming juggernaut, and the stock was languishing as a broken IPO before showing the market the kind of growth that it's capable of generating.

iQiyi stock is trading 58% higher than its IPO price of $18, which was a little more than two months ago, but if we go by the $15.30 it hit when it bottomed out on its fourth day of trading, the stock has gone on to nearly double. The strong quarter and a premium partnership with Chinese online retailer (NASDAQ:JD) got the ball rolling in its bullish direction.

The deal with to have members signing up for iQiyi VIP or JD Plus to enjoy the perks of the other platform's premium benefits is off to an encouraging start, with more than 1 million members signing up in the partnership's first few weeks. A million shared premium customers may be a drop in the bucket for a company that's now at 61 million premium subscribers, but it's helping accelerate growth. Revenue rose 57% in iQiyi's first quarter, higher than the 55% increase it posted for all of last year. 

Losses continue, but analysts have accepted that we're years away from profitability. iQiyi is investing in marketing and content to attract and retain users, and it will be those measuring sticks that the stock will be judged by in the coming quarters. It also doesn't hurt when membership services are growing faster than ad revenue, an encouraging sign that the company is doing a better job of converting its huge base of free users into paying customers.  

The next few days will be interesting. If the stock holds or builds on its recent gains, there will be plenty of bullish analysts with price targets well below where the stock is now. Those Wall Street pros will need to either downgrade the stock or boost their price targets.

There naturally will be a lot riding on iQiyi's next quarterly report to validate the bullish trends investors saw the first time around, but those numbers won't come out until late July. The bulls are feeling pretty good right now, but the bears were felling the same way two months ago.