Tag Archive | "CYOU"

Today’s Top Chinese Movers

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Today’s Top Chinese Movers


China Mobile (CHL) is among today’s top gainers by market share while Changyou.com (CYOU) was among today’s top losers by percentage change.

China Mobile Ltd. [[CHL]] gained more than 3.3% in normal trading today. China’s largest cellphone company added more than $13 billion in market capitalization despite no news to report.

Changyou.com Ltd. [[CYOU]] lost more than 8.3% despite reporting excellent second quarter results today. The Chinese online game maker recently spun-off from Sohu.com [[SOHU]] reported earnings and revenue in excess of analysts’ expectations, with non-GAAP net income of $0.75 per share on a record $66.6 million in revenue. Furthermore, Citigroup reaffirmed its ‘Buy’ rating and $45 price target on the shares.

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Changyou.com Expected to Report Q2 EPS of 61 cents

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Changyou.com Expected to Report Q2 EPS of 61 cents


Chinese game maker Changyou.com (CYOU) is expected to earn 61 cents per share on revenue of nearly $65 million for the three-months ending June 30th.

Changyou.com [[CYOU]], the recently spun-off Chinese online game maker, is set to announce set quarter earnings this coming Monday. Here’s what to expect.

EPS: $0.61
Revenue: $64.9 million

Analysts have been bullish on EPS, with estimates creeping upwards from an average of $0.59 per share to its current level.

With the explosive rise in the company’s shares over the last six months, analysts have cooled on how attractive they think the shares are overall. Changyou.com suffered a downgrade by both Roth Capital and Susquehanna Financial at the end of June.

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Changyou.com Remains a Compelling Value

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Changyou.com Remains a Compelling Value


Changyou.com Limited (CYOU) shares may be well above their initial public offering price, but the stock continues to trade a compelling valuation given its growth.

Changyou.com Limited [[CYOU]], a China-based online game developer and operator, is up nearly 90 percent from its initial public offering. However, shares continue to trade at just 7.14x with explosive historical growth rates and strong projection for the 2009. As a result, investors may want to take a second look at this young company as a strong play on China.

During the first quarter, Changyou.com reported net income of $33.5 million on total revenues of $61.6 million. This represented a 15% increase quarter-over-quarter and a 120% increase year-over-year, suggesting that this stock may be substantially undervalued at these levels. Meanwhile, active paying accounts also increased to 2.27 million – up 50% year-over-year.

“I’m pleased to have delivered another quarter of record results as we report for the first time as a standalone public company,” said Mr. Tao Wang, Changyou’s chief executive officer. “Online games, which provide low-cost entertainment, continue to be a very popular leisure time activity in China, even in an economic downturn, making the industry a strong defensive play.

“Our peak concurrent users and active paying accounts reached record highs during the quarter, demonstrating the efficacy of our strategy of focusing on the user experience. We continued to leverage synergies with our parent company Sohu.com Inc. (Sohu) and our expanded offline marketing efforts to reach gamers in new cities and increase our penetration in existing cities.

“With our strong execution capabilities, I’m confident that we can successfully extend the lifespan of our existing games and release new titles that capture the imagination and mindshare of China’s growing population of online gamers.”

In the end, Changyou.com trades with a conservative historical P/E to growth ratio of around 0.1 and a future ratio of 0.5. These numbers suggest that the stock is greatly undervalued at these levels given its potential growth rates, and may therefore represent a compelling opportunity for investors interested in adding a Chinese element to their portfolio.

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Chinese Internet Stock to Benefit from Recovery


Sohu.com Inc. (SOHU) and Baidu Inc. (BIDU) could be two key beneficiaries of a Chinese economic turnaround, as strong growth rates stand to multiply the effects of a recovery.

From automobiles to real estate, China’s economic stimulus package appears to be improving many areas of its economy. While first quarter gross domestic product growth grew just 6.1%, the slowest in almost a decade, many analysts are decidedly bullish. In fact, the Shanghai stock market is up 35% so far this year, signaling a positive future outlook by investors.

One of the fastest growing industries in China, as in the Western world, is the internet sector. While China now has the world’s largest internet population, having taken over the U.S. for the title in early 2008, it still has a lot of ground to make up in terms of market maturity. Regardless, there is room for opportunity with online ad spending expected to reach $3.5 billion by 2012.

Sohu.com Inc. [[SOHU]], an online Chinese news and entertainment provider, has continued to succeed with first quarter net income more than doubling over the same period a year ago. The company was also able to effectively capitalize the value of its former subsidiary by spinning off ChangYou [[CYOU]] and retaining a 68.5% stake in its combined Class A and Class B shares.

Baidu Inc. [[BIDU]], the leading Chinese online search provider, has also seen strong growth with net income increasing by 23.5% from the corresponding period in 2008. Meanwhile, revenues jumped 41.1% and operating profit increased 34.7%. Many investors are confident that this performance will substantially increase upon any economic recovery in China.

In the end, these two Chinese internet companies continue to outperform and should be able to take advantage of the so-far-successful Chinese economic recovery.

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