Research Reports

  • Sina Corporation: How Much Has SINA been Undervalued? Expect In Line 2Q16 Results; Maintain Buy
    SINA2016-08-05

    Sina Corporation: How Much Has SINA been Undervalued? Expect In Line 2Q16 Results; Maintain Buy

    SINA will report 2Q16 results on Monday, August 8 after the market closes followed by a 9:10pm EST earnings call. We are expecting 2Q results to be at least in line with consensus driven by solid results from its core business Weibo. We believe Sina is significantly undervalued. SINA owns 54.5% of WB, which is valued at $7B. In addition, SINA has $1.4B net cash. Just adding the value of these two, SINA should be valued at $74.50 per share, a 36% upside from its current level. Also, since SINA is working to transition its portal business to verticals, we believe new risks can be low. Therefore, we maintain our Buy rating on the stock.……

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  • Weibo Corporation: Fans Economy and KOLs Drive Better Growth; 3Q16 Revenue Guidance in USD May Be Impacted by RMB Depreciation; Maintain Buy Rating
    WB2016-08-04

    Weibo Corporation: Fans Economy and KOLs Drive Better Growth; 3Q16 Revenue Guidance in USD May Be Impacted by RMB Depreciation; Maintain Buy Rating

    Weibo will report 2Q16 results on Monday, August 8 after the market closes followed by a 9pm EST conference call. We are expecting Weibo to report 2Q revenue better than consensus driven by the growth of fans, KOLs as well as traffic.For 3Q16, we expect WB to continue its growth momentum of around 31% Y/Y in RMB terms but in absolute USD terms, the guidance may be lower than current unadjusted consensus at $163.7M due to significant currency depreciation.However, we do not believe the currency issue is new to the market.Fundamentally, we believe Weibo is well positioned to capture the rapid growth in social media enabled fans economy. Therefore, we maintain our BUY rating on the stock and raise our PT to $38.00 from $21.00.……

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  • Chinese TAL Education Group: Upside Potential to FY2Q17 Outlook and Full Year Driven by Capacity Expansion; Maintain BUY
    XRS2016-07-28

    Chinese TAL Education Group: Upside Potential to FY2Q17 Outlook and Full Year Driven by Capacity Expansion; Maintain BUY

    XRS reported strong FY1Q17 revenue results that beat consensus while the bottom line came in slightly below the Street. The FY2Q17 guidance was also solid, better than the Street expectation. For FY2017, the company is maintaining a rapid expansion plan. While the rapid growth in capacity may put pressure on margins, we believe it can be near term and the positives to both top line and margin growth can be long term. We see upside potential to FY2Q17 as well as for the full year based on our proprietary data. Therefore, we maintain our BUY rating and our PT of $68.00.……

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  • Baidu, Inc.: Expect 2Q16 Results To Be In Line With Preannounced Guidance; 3Q16 Consensus Can Be Conservative; Maintain BUY
    BIDU2016-07-27

    Baidu, Inc.: Expect 2Q16 Results To Be In Line With Preannounced Guidance; 3Q16 Consensus Can Be Conservative; Maintain BUY

    BIDU will report 2Q16 results on Thursday, July 28 after the close of the market followed by an 8pm EST conference call. We are expecting the company to report 2Q revenue in line with its preannounced guidance of 9% - 10% Y/Y growth. 2Q16 is a bad quarter for BIDU, as 1) the death of a young cancer patient triggered the government to review BIDU’s medical and healthcare sector; and 2) the search business is now classified as advertising, in which two-thirds of BIDU’s revenue will incur another 3% tax as cost, which will impact the gross margin by 2%. After all these negatives, we believe that at least in the midterm, the negatives and uncertainties are in the stock and BIDU will still be a dominant vendor in online search before mobile search replaces PC. Therefore, we maintain our BUY rat……

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  • T. H. Data Flash – AO Smith – June 2016: AOS 2Q16 Revenue May Just be In Line with Consensus
    2016-07-25

    T. H. Data Flash – AO Smith – June 2016: AOS 2Q16 Revenue May Just be In Line with Consensus

    AOS will report 2Q16 results on Tuesday, July 26 before the market opens. According to our data tracked from the largest e-commerce channels in China,Tmall.com and JD.com, we project AO Smith’s China sales to grow about 13% Y/Y in USD term after taking into consideration the unfavorable impact of currency depreciation of about 7%. If all our modeling assumptions are right, and based on our data, we believe AOS total sales may just be inline with consensus at 6% Y/Y decline.……

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  • Chinese TAL Education Group: Expect Strong FY1Q17 on Robust Enrollment and Course Growth; Increase in Capacity and Price Can Sustain Growth in FY2017; Maintain BUY and Raise PT to $68
    XRS2016-07-23

    Chinese TAL Education Group: Expect Strong FY1Q17 on Robust Enrollment and Course Growth; Increase in Capacity and Price Can Sustain Growth in FY2017; Maintain BUY and Raise PT to $68

    XRS will report FY1Q17 results before the market opens on Tuesday, July 26, 2016with an 8:00AM EST conference call. Based on our proprietary data, we believeXRS’s FY1Q17 results are likely to outperform consensus expectation driven bystrong growth in total course offered and course attendees offset by the decline inASP. The growth in attendees, we believe, is mainly driven by the growth in itscapacity. As the capacity continues to increase, we also believe that the companyis likely to have high growth in fiscal year 2017. Therefore, we maintain our BUYrating and raise our PT to $68.00 from $48.00.……

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  • T. H. Data Flash – Mead Johnson – June 2016: MJN 2Q16 Revenue May be Better than Consensus
    2016-07-22

    T. H. Data Flash – Mead Johnson – June 2016: MJN 2Q16 Revenue May be Better than Consensus

    MJN will report 2Q16 results on Thursday, July 28 before the market opens.According to our online sales data tracked from China e-commerce sites (Figure 1),we project China/Hong Kong sales of Mead Johnson to be stable or slightly downsequentially in 2Q16 in USD term after considering unfavorable currencydepriciation at about 7%. If we adopt what we believe is the most reasonable ratiosof online sales to total sales in China, China to Asia, and Asia to total MJN, webelieve the company is likely to report 2Q16 total revenue better than consensus at6.6% Y/Y decline.……

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  • New Oriental Education & Technology: Solid FY4Q16 Results; FY1Q17 Promotions May Benefit the Whole Year; Maintain Buy and Raise PT to $52
    EDU2016-07-22

    New Oriental Education & Technology: Solid FY4Q16 Results; FY1Q17 Promotions May Benefit the Whole Year; Maintain Buy and Raise PT to $52

    EDU reported strong FY4Q16 top line results of 20.1% Y/Y, which beat consensusexpectation, and EPS came in a penny below the Street after about 7% RMBdepreciation. For FY1Q17, the company guided revenue in USD terms belowconsensus due to the RMB depreciation. While FY1Q17 is a weak quarter, it is themost important quarter for the full year growth; therefore the company isaggressively doing promotions to recruit new students, which has already resultedin about 200K enrollments from the summer classes. From last year’s experience,we believe the promotion can benefit the rest of the year with a high retention rateof about 50%. As we believe EDU’s fundamentals and outlook are strong, wereiterate our Buy rating and raise our price target to $52.00.……

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  • New Oriental Education & Technology: Better FY4Q16 Driven by Increase in Utilization; Aggressive Promotion in FY1Q17 Can Be Positive for Full Year 2017, but Not For FY1Q17; Maintain Buy
    EDU2016-07-15

    New Oriental Education & Technology: Better FY4Q16 Driven by Increase in Utilization; Aggressive Promotion in FY1Q17 Can Be Positive for Full Year 2017, but Not For FY1Q17; Maintain Buy

    EDU will report FY4Q16 results on Wednesday, July 20th before the markets openwith an 8am EST conference call. Based on our proprietary data, we expect EDU toreport FY4Q16 results better than consensus driven by the increase in utilization ofboth courses and attendees. For the bottom line, we are expecting better marginsas a result of less new school openings and higher tuition per student per course.For FY1Q17, the company is offering low rate courses aggressively. While it maypressure FY1Q17’s financial performance, it is an effective way of recruitingstudents for the entire year. As we believe EDU’s fundamentals and outlook arestrong, we maintain our Buy rating. We are suspending our price target of $34.00and will revisit the PT after earnings.……

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  • T. H. Data Flash – eBay Inc. – 2Q16: eBay 2Q16 Results Are Likely To Outperform Consensus
    2016-07-14

    T. H. Data Flash – eBay Inc. – 2Q16: eBay 2Q16 Results Are Likely To Outperform Consensus

    2Q16 results may be better than consensus – eBay will release 2Q16 resultson Wednesday, July 20th after the markets close followed by a 5pm ESTconference call. According to our proprietary data, we expect eBay’s 2Q16 resultsto come in higher than consensus expectation at 2.97% Y/Y growth.……

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  • T. H. Data Flash – Lending Club Corporation – 2Q16: Lending Club’s 2Q16 Revenue May be Below Consensus; but Recovery Seems to be Slow
    2016-07-12

    T. H. Data Flash – Lending Club Corporation – 2Q16: Lending Club’s 2Q16 Revenue May be Below Consensus; but Recovery Seems to be Slow

    2Q16 is likely to come in below consensus expectation – According to ourproprietary data, Lending Club’s loan originations are likely to decline 20.1% Y/Yand 44.4% Q/Q to about $1,528M (Figure 1), along with the decline of loanorigination volume. The decline in loan origination amount is below the companyexpectation of one-third Q/Q decline. As such, the Street expects its 2Q16 toplineto decline 27.3% Q/Q or $110.65M, which we believe could be too optimistic.However, after the low during the week of May 30 to June 5, 2016, our data showsthat the situation has been improving since then (Figure 2), but the improvement isslow.……

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  • T. H. Data Flash – Apple Inc. – FY3Q16: Apple’s Greater China Sales May be Weaker in FY3Q16
    2016-07-11

    T. H. Data Flash – Apple Inc. – FY3Q16: Apple’s Greater China Sales May be Weaker in FY3Q16

    Apple’s F3Q16 may be weaker – While Apple’s online sales in China are stillgrowing, our proprietary data suggest that its total Greater China sales is likely tobe weaker than consensus expectation in FY3Q16. We use two sets of data tomake our projections of Apple’s Greater China sales:……

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  • 58.com Inc.: TH Data Suggests Better 1Q16 Results; Opearting Margin Is Likely To Improve Due To The Deconsolidation Of 58 Home
    WUBA2016-05-30

    58.com Inc.: TH Data Suggests Better 1Q16 Results; Opearting Margin Is Likely To Improve Due To The Deconsolidation Of 58 Home

    WUBA will report 1Q16results on Thursday, June 2 before the markets open with an 8am EST conferencecall. Our proprietary data suggests that WUBA is likely to report 1Q16 resultsbetter than the Street expectation due to the increase in both membership andbidding businesses. More importantly, we believe WUBA is likely to improve its non-GAAPoperating margin in 2016 compared with 2015, due to the deconsolidation ofGuazi and 58 Home. We initiate the coverage of WUBA with a BUY rating and pricetarget at $61.00……

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  • T.H. Capital - T. H. Data Flash – Vipshop Holdings Limited (VIPS) – 1Q16 & Apr. 2016
    VIPS2016-05-18

    T.H. Capital - T. H. Data Flash – Vipshop Holdings Limited (VIPS) – 1Q16 & Apr. 2016

    VIPS is going to report its 1Q16 results on Tuesday, May 17, 2016 after market close and will hold a conference call on Wednesday, May 18, 2016 at 8:00 am. Based on our proprietarydata and calculations, we believe VIPS is likely to report 1Q16 revenue resultat about 44% - 48% Y/Y better than consensus expectation at 43% Y/Y growth.……

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  • T.H. Capital - Huazhu Hotels Group Ltd.: Expect In Line 1Q16 Results and 2Q16 Guidance; Shanghai Disneyland is A Long-Term Benefit; Raise PT to $40
    HTHT2016-05-12

    T.H. Capital - Huazhu Hotels Group Ltd.: Expect In Line 1Q16 Results and 2Q16 Guidance; Shanghai Disneyland is A Long-Term Benefit; Raise PT to $40

    HTHT will report 1Q16 results on Wednesday, May11 after themarket close followed by an 9pm ET conference call. We believe HTHT is likelyto report 1Q16 results largely in line with consensusexpectations. The 2Q16 guidance can be at least in line with consensus due to ahealthy RevPAR in April, 2016. As the Shanghai Disneyland is scheduled to openon June 16, 2016, we believe HTHT is going to benefit from increasing tourists’inflow. As such we raise our PT to $40.Shanghai Disneyland to be positive to HTHT’sbusiness – Shanghai Disneyland, which is scheduled to open on June 16, 2016, canbe positive to HTHT's business as we believe it is highly likely to boostdemand for travel and lodging in the Shanghai area. On an annual basis, Shanghai receives about 100Mtourists. However, using Hong Kong ……

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  • T.H. Capital - Leju Holding Limited: Market Hike In March Led To Market Tightening; Maintain Hold
    LEJU2016-05-12

    T.H. Capital - Leju Holding Limited: Market Hike In March Led To Market Tightening; Maintain Hold

    LEJU will report 1Q16 results before the marketopens on May 16, 2016 with a 7:00 AM ET conference call. It's highly likely thatthe company may deliver better 1Q16 results compared with consensus as LEJU benefiteda great deal from the market hike in the first quarter of 2016. However, webelieve the hike has already led to the government’s tightening regulations inShenzhen and Shanghai since late March, which will impact the business for therest of 2016. We maintain our Hold rating until we see business stabilization.Outlookfor the rest of 2016 is not optimistic due to new restrictive policies in tier1 cities – LEJU provided full year revenueguidance at around $660M. We believe the upside potentials from this guidancecan be limited due to the new policies. Post the market hike in March, ……

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  • T. H. Data Flash – Bitauto Holdings Ltd. – 1Q16: BITA Gains Addtional Dealers While Maintaining High Retention Rates
    BITA2016-05-12

    T. H. Data Flash – Bitauto Holdings Ltd. – 1Q16: BITA Gains Addtional Dealers While Maintaining High Retention Rates

    1Q16 Operating Data Highlights:Data in thisreport is extracted from publicly available sources and processed with ourproprietary methodology. Please contact us for detailed information.·        Registered and paying dealersincreased Y/Y for BITA in 1Q16 – Accordingto our proprietary data, BITA’s registered dealers grew to 26.7K in 1Q16 from 25.2Kin 1Q15, up 5.9% Y/Y. The paying dealers of BITA increased to 18.3K in 1Q16 from17.7K in 1Q15, up 3.4% Y/Y (Figure 1).The paying ratio for BITA was 66.5% in March 2016, slightly declined from 70.6%in March 2015, mainly due to relatively faster increase in registered dealers (Figure 1). ·        BITA maintained high paying dealerretention rates -The retention rates of paying dealers for BITA remained at high l……

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  • T.H. Capital - NetEase, Inc.: Steady Growth In Games and Ads Combining with Better Kaola Drives Better 1Q16 Results; Maintain Buy and Price Target
    NTES2016-05-12

    T.H. Capital - NetEase, Inc.: Steady Growth In Games and Ads Combining with Better Kaola Drives Better 1Q16 Results; Maintain Buy and Price Target

    NTES will report 1Q16 results on Wednesday, May11th after the close of themarket followed by an 9pm EST conference call. NTES is highlylikely to deliver 1Q16 results better thanconsensus expectation ofnet revenue at $1,225.98M (117.1%Y/Y growth) drivenmainly by ecommerce while game and advertising are growing nicely. We believethat NTES can continue its strong growth in mobile games due to its strongcontent development capability. Wemaintain our Buy rating and raise our price target at $168.00.·        Steady growth in mobile games – According to our proprietary data, NTES’s mobilegames continue to be the growth driver. In 1Q16, the total number of gameservers reached 2,279, up 4.3% Q/Q from 2,184 in 4Q15 (Figure 1); among that, mobile game servers grew 8.7% Q/Q, while ……

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  • T.H. Capital - Weibo Corporation: Trending Up In Fan Economy Fuels Upsides in WB; Maintain Buy Rating and Raise PT To $25.00
    WB2016-05-12

    T.H. Capital - Weibo Corporation: Trending Up In Fan Economy Fuels Upsides in WB; Maintain Buy Rating and Raise PT To $25.00

    Weibo will report 1Q16 results on Wednesday, May11th after themarket closes followed by an 9pm EST conference call. We are expecting Weibo toreport better 1Q16 results and to provide better 2Q16 guidance due tocontinuing execution of its monetization strategies as well as upward trend infan economy. From our proprietary data, we believe Weibo’s adoptions are at a highspeed and engagement level is continuing to trend up. As such we are optimisticabout Weibo’s outlook. Therefore, we maintain ourBUY rating on the stock and raise target price to $25.00 from $21.00·        Better engagements and adoption in fan economy fuel upsides in WB – As a leading player in today’s fan economy, Weibo continues to gainmomentum. There are two ways to show such momentum: 1) the engagements……

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  • T.H.Capital - Chinese TAL Education Group - Strong Enrollments To Driven Upside in FY4Q16; Expansions, Promotions and One-time Tax To Pressure Margins; Maintain BUY and Raise PT to $55.00
    XRS2016-04-01

    T.H.Capital - Chinese TAL Education Group - Strong Enrollments To Driven Upside in FY4Q16; Expansions, Promotions and One-time Tax To Pressure Margins; Maintain BUY and Raise PT to $55.00

    XRS will report FY4Q16 results before the market opens on Thursday, April 28,2016 with an 8:00AM EST conference call. Based on our proprietary data, webelieve the company is likely to deliver FY4Q16 revenue better than the consensusexpectation driven by strong growth in total course offered and course attendeesoffset by the decline in ASP as a result of expansion and promotions. Our data alsoshows that the strong promotions as well as one-time higher tax in the quarter maycause margin pressure. However, we remain positive on the outlook of XRS as itscourses is demanded by students evdenced by the high course utilization rate.Therefore, we maintain our BUY rating and raise our PT to $55.00 from $48.00.……

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