Is Sina Corp. Doomed to Keep Investors Away?

T = Technicals on the Stock Chart are Weak

As of December 4, Sina’s stock price was 10.76 percent below its 20-day simple moving average, or SMA; 20.43 percent below its 50-day SMA; and 21.09 percent below its 200-day SMA.

Since the beginning of 2012, the stock has been in a pronounced downward trend, losing 24.3 percent of its value this year to date, and 36.56 percent year over year.

For comparison, shares of Sohu are down 27.35 percent this YTD while shares of NetEase are down 8.20 percent for the period.

E = Earnings are Increasing Quarter over Quarter

Sina has a fairly strong revenue history but a weak earnings history. Revenues have increased in three out of the last four years, growing over 50 percent in 2008, dropping less than 3 percent in 2009, growing 12 percent in 2010, and nearly 20 percent in 2011.

2007 2008 2009 2010 2011
Revenue ($) in thousands 246,127 369,587 358,567 402,617 482,829
Diluted EPS ($) 0.96 1.33 6.95 (0.31) (4.64)

 

The quarter-to-quarter picture reveals a company struggling to maintain revenues but regaining some ground with two consecutive quarters of positive earnings.

Sept. 2011 Dec. 2011 Mar. 2012 June 2012 Sept. 2012
Revenue ($) in millions 130.29 133.37 106.22 131.60 152.38
Diluted EPS ($) -5.10 0.08 -0.21 0.49 0.14

 

That massive earnings hit in the third-quarter of 2011 is due to a write down on investments, and is the driving force behind the earnings loss for 2011.