Monday, February 4, 2008

Sohu.com (SOHU) Also Impressive

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I've been watching Sohu.com [Dec 5th- Sohu.com Raises Guidance] and am very interested in this name. The stock was in the mid $60s in early December when it raised guidance and all it got as a reward was a smack aside the head; it traded down to the upper $30s in the January swoon. It has now recovered back to upper $40s, and technically sits right at its 50 day moving average of just under $50. Each time I want to buy this, I remember how all Chinese stocks are thrown in a stew together and either viewed as good or bad. Poor Sohu.com. But I do like the business momentum and if the stock can build off these nice earnings.... and raised guidance (again), we should see a nice move. (if the market were willing of course)

There are quite a few Chinese online video game makers, but Sohu.com has the advertising arm that intrigues me.
  • Chinese Internet portal operator Sohu.com Inc. said Monday fourth-quarter profit more than doubled on strong brand advertising and online game revenue. For the quarter ended Dec. 31, net income rose to $15.1 million, or 39 cents per share, from $6.1 million, or 16 cents per share, in the prior year quarter. Excluding stock-based compensation charges, the company earned 43 cents per share.
  • Analysts polled by Thomson Financial expected earnings of 31 cents per share.
  • Revenue rose 90 percent to $65.3 million from $34.4 million in the fourth quarter of 2006. Analysts predicted revenue of $55.4 million.
  • Advertising and non-advertising revenue both rose substantially in the quarter, helped by a 46 percent rise in brand advertising revenue and soaring online game revenue.
  • For the year, net income jumped 35 percent to $34.9 million, or 90 cents per share, from $25.9 million, or 68 cents per share in the prior year. Revenue rose 41 percent to $188.9 million from $134.2 million in 2006.
  • Chinese Internet portal operator Sohu.com Inc. said Monday its first quarter profit would rise above Wall Street analyst estimates. The company said it expects earnings per share between 43 cents and 45 cents for the quarter, excluding share-based compensation expenses between 8 cents and 9 cents per share.
  • Analysts polled by Thomson Financial expect earnings of 32 cents per share.
  • Total revenue in the quarter will likely be between $66.5 million and $68.5 million. Analysts predict revenue of $59 million for the period. The company estimated ad revenue between $33.5 million and $34.5 million and non-advertising revenue between $33 million and $34 million.

No position (yet)


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