For the third quarter of 2007, SINA Corp's (SINA) EPS exceeded market consensus, while its revenue was in line with the market consensus. SINA continued to do well in its online brand advertising, and increased the gap between it and its closest competitor in the online brand ad market because SINA is one of the most well-known online brands in China.
Moreover, the Beijing Olympic Games can significantly stimulate the online advertising business in China in the next several quarters. Therefore, we are maintaining our Buy rating for SINA.
The stock is currently trading at 33.8x our estimate for fiscal year 2008 earnings per share, which is higher than the industry mean and that of its closest Chinese competitors. The stock is also trading at 24.5x our estimate for fiscal year 2009 earnings per share, which is lower than the industry mean. Using a P/E multiple of approximately 28.0x our fiscal year 2009 earnings per share estimate yields a target price of $50.00, which we believe reflects the company's current prospects.
Read the full analyst report on SINA.
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