Qihoo Upgraded to Strong Buy - Analyst Blog

By
A A A

On Nov 29, Zacks Investment Research upgraded Qihoo ( QIHU ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Qihoo posted better-than-expected third-quarter fiscal 2013 results, wherein earnings of 35 cents per share surpassed the Zacks Consensus Estimate of 26 cents.

Management cited that Qihoo's continued focus on the Internet and consistent product innovation have been its primary growth drivers to date. They expect these efforts to result in a Tier 1 PC and mobile Internet platform in China in the near future.

The company posted third-quarter revenues of $187.7 million, representing an increase of 124% from $84.0 million in the year-ago quarter and 24% from $151.7 million in the prior quarter. The strong year-over-year growth in revenues was mainly due to continued momentum in both online advertising and Internet value-added services.

It's true that building a position in a market dominated by a strong player like Baidu ( BIDU ) will not be easy. Baidu has grown into the go-to search service in China and the company doesn't look as if it is going to yield significant market share.

However, Qihoo has made good progress in search monetization, which is very encouraging because upcoming players generally don't have an offering that is compelling enough to attract a large number of advertisers. Therefore, Qihoo's success with monetization indicates that its property is valuable to advertisers, which in turn is a positive indicator of its future growth.

Other Stocks to Consider

Some other players worth considering in the technology sector include Digital River Inc. ( DRIV ) and Channeladvisor Corp ( ECOM ), both carrying a Zacks Rank #1 (Strong Buy).



BAIDU INC (BIDU): Free Stock Analysis Report

DIGITAL RIVER (DRIV): Free Stock Analysis Report

CHANNELADVISOR (ECOM): Free Stock Analysis Report

QIHOO 360 TECH (QIHU): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: BIDU , DRIV , ECOM , QIHU

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Tiny Homes With Big Appeal
Tiny Homes With Big Appeal          

Stocks

Referenced

Most Active by Volume

270,887,127
    $93.89 unch
225,243,115
  • $40.93 ▼ 2.74%
135,900,109
  • $47.52 ▲ 1.80%
89,467,924
  • $5.35 ▼ 1.11%
85,105,358
  • $16.95 ▼ 0.53%
80,748,539
  • $39.80 ▼ 4.21%
68,491,586
  • $3.57 ▼ 1.79%
62,097,356
  • $100.96 ▼ 0.82%
As of 9/19/2014, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com