On Nov 29, Zacks Investment Research upgraded
) 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
It's true that building a position in a market dominated by a
strong player like
) 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
Other Stocks to Consider
Some other players worth considering in the technology sector
Digital River Inc.
), both carrying a Zacks Rank #1 (Strong Buy).
BAIDU INC (BIDU): Free Stock Analysis Report
DIGITAL RIVER (DRIV): Free Stock Analysis
CHANNELADVISOR (ECOM): Free Stock Analysis
QIHOO 360 TECH (QIHU): Free Stock Analysis
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