Research Reports

BIDU is at a turning point in its business. The company has established its new strategy – all in AI, which we believe has played into BIDU’s strength. BIDU now has all it needs to become a leader in AI applications in China. For its upcoming 3Q17 earnings report on Thursday (October 26th after the market closes followed by an 8pm EST conference call), based on our data and calculations, we believe BIDU is likely to deliver 3Q17 top line at RMB23.683B, at least in line with or slightly higher than consensus at RMB23.547B; its guidance is between RMB23.130B – RMB23.750B. ……

TAL will report FY2Q18 results before the market opens on Thursday, October 26, 2017 with an 8:00AM EST conference call. Starting from FY3Q18, we are going to see slower expansion, but TAL will offer more high-price offerings. The company is modifying its high speed expansion to moderate expansion in physical locations. At the same time TAL has increased the quantity of higher price class offerings, which will contribute to top line growth going forward. We believe such changes are also positive to its margins. As for FY2Q18, based on our proprietary data, the topline is likely to outperform consensus expectation driven by strong growth in total class offerings and attendees. We maintain our BUY rating.……

EDU will report FY1Q18 results on Tuesday, October 24th before the markets open with an 8am EST conference call. The company has been conservative in terms of its expansion, but EDU recently changed its approach to one of higher expansion, with high growth in new learning centers and course offerings. Based on our proprietary data, we believe expansion as well as its higher utilization rate is likely to drive high growth in its topline in FY1Q18, but more so in FY2Q18. Consensus for FY1Q18 at $642.3M and FY2Q18 at $426.0M can be conservative. Certainly, the high expansion may cause near term pressure to its margins. As we believe EDU’s fundamentals and outlook are strong, we maintain our Buy rating. ……

•3Q17 revenue is likely to outperform consensus – Based on our data and calculations, HTHT’s net revenue is likely to grow 37% Y/Y (+22.0% Q/Q) to reach RMB2,430.3M in 3Q17 (Figure 7), better than consensus topline at RMB2,315.0M (+30.5% Y/Y) and the high-end of guidance range at 30% - 34% Y/Y growth. ……

Marketingand channel activities have positive impacts – Average hourly current users were up in 3Q17E toreach 45,295 from 39,558 in 2Q17, mainly due to new functions in MOMO version8.0 (Figure 1). ……

While thebundled sales issue continues to linger, based on our data and calculations, weexpect CTRP’s 3Q17E revenue to be around RMB7,700M, better than or at leastin-line with consensus at RMB7,647M and toward the higher-end of its revenueguidance range of RMB7,522.0M - RMB7,800.6M (35% - 40% Y/Y growth). ……

Course offerings upsignificantly in FY2Q18 -According to our proprietary data for FY2Q18, the number of total courses offered increased 67.9% Y/Y to 131,230. Along with that, fully registered courses at 84,869 increased 40.7% Y/Y in FY2Q18 (Figure 1). ……

The WB platform needsto be cautious in 4Q17 due to the Party’s Meeting - The 19th session of the National Congress ofthe Communist Party of China is scheduled to be held on Oct. 18, 2017.……

Based on our data andcalculations, we believe BIDU is likely to deliver 3Q17 top line at aroundRMB23.683B, at least in-line with or slightly higher than consensus atRMB23.538B. ……

Higher growth in loan originations may lead to better 3Q17 – According to ourproprietary data, total amount of loans facilitated on YRD’s platform is likelyto grow 108.6% Y/Y to RMB11,720.7M in 3Q17E (based on July and August data).……

Increase in courseofferings and utilization rate driven by K-12 – According to our proprietary data for FY1Q18,the number of total courses offered was 135.0K in FY1Q18, up 24.8% Y/Y from108.1K in FY1Q17, and the number of fully registered courses increased 26.2%Y/Y to 39.4K in FY1Q18 from 31.3K in FY1Q17. ……

Basedon our proprietary data for preliminary 3Q17, we believe YY’s revenue is likely to be betterthan consensus at RMB2.808B and guidance range of RMB2.75B - RMB2.85B driven byentertainment live broadcastings as well as game broadcastings.……

Based on our dataand calculations, we believe BITA’s 3Q17 revenue is likely to be aroundRMB2,300M, better than consensus revenue expectation at RMB2,210.1M, mainlydriven by its auto financing business. ……

Based on our data andcalculations, we believe ATHM is likely to report 3Q17 revenue higher thanconsensus. ……

SFUN will report 2Q16 results before the U.S. markets open on August 25, 2016 with an 8am EST conference call. We do not expect SFUN to deliver a turnaround 2Q16, but we do expect the company to reach breakeven in 4Q16 after two years of restructuring. The real estate market in China is developed unevenly as prices and volumes in major cities continue to increase while prices and volumes continue to go down in lower tier cities. Fortunately, SFUN’s business activities are concentrated around 30 top cities with the most active real estate activities. As we expect these markets to continue to do well, we maintain our Buy rating on the stock and price target of $9.00.……

VIPS will report 2Q16 results on Monday, August 15 after the market close with a conference call the next day at 8am EST. Based on our data, VIPS is likely to report its revenue better than consensus expectations, but margin may not improve as there are more promotions. However, 3Q16 guidance may be in-line with the Street as our data show that the sold-out SKU days and sold-out rates in July did not outperform compared with 2Q16.……

BABA will report F1Q17 results on Thursday, August 11 before the markets open with a conference call at 7:30am EST. We believe the company is likely to report F1Q results better than the Street consensus based on accelerating Tmall GMV growth, the consolidation of Youku’s advertising revenue and ad revenues from inventories on the Taobao and Tmall platforms. We maintain our Buy rating and raise our price target to $97.00.……

JD will report 2Q16 results on Wednesday, August 10th before the market open with a 7:30am EST conference call. We are expecting both 2Q16 revenue and 3Q16 top line guidance to be slightly below consensus expectation. In addition, we believe the company’s margin may be under pressure from the newly acquired Yihaodian, an online company in China formerly owned by Walmart. Both growth and margin issues may last for a while. As such, we downgrade the stock from BUY to HOLD and wait for signs of improvement.……