SINA Corp (SINA) analysts are raised estimates following the latest earnings surprise, pushing shares close to the 52-week high.
Company Description
SINA is a Chinese online media company and mobile value-added service provider. The company has its own branded websites offering search engines, online shopping, blogs, gaming, email and other e-services.
Revenue Rebounding
On Aug 4 SINA reported a 10% increase in net revenues, to $99.4 million. Advertising revenue was up 52% and came in higher than expectations, at $73.1 million.
Net income improved 62% to $27.7 million, or 40 cents per shares. Analysts were looking for 29 cents, giving SINA back-to-back earnings surprises and the company has just 2 misses in the past 5 years.
Estimates Surge
Following the earnings news analysts raised full-year estimates for 2010 and 2011. The Zacks Consensus Estimate for 2010 is now $1.47, up 16 cents.
Next year’s forecasts are averaging $1.82, up 19 cents. If SINA can hit these levels the annual growth rates will be 141% and 24%, respectively.
Shares of SINA are trading with fairly lofty valuations, but this is not abnormal for the company. The forward P/E is about 30 times and the PEG is 1.6.
The Chart
The stock had been hitting resistance just under the 52-week high, but the recent momentum has forced shares higher. SINA is just below the high, but with the current momentum I think it will be setting a new high very soon.
Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service
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