SINA Corp (NASDAQ: SINA), a Chinese online media company, is scheduled to report Q2 EPS on August 6. SINA August option implied volatility is at 78; September is at 55. SINA average option implied volatility over the last 26-weeks is 58 according to Track Data, suggesting larger August price movement.
The9 (NASDAQ: NCTY), an online game operator headquartered in Shanghai, closed at $22.73. NCTY is scheduled to report Q2 EPS on August 7. NCTY August option implied volatility is at 101, September at 81; above its 26-week average of 69, suggesting larger price movement.
NetEase (NASDAQ: NTES), an interactive online community in China, is scheduled to report Q2 EPS after the market close on August 13. NTES August option implied volatility of 70 is above its 26-week average of 45, suggesting larger price fluctuations.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
MOST NOTEWORTHY: Syneron Medical, Cellcom Israel, GATX Corp and TNS, Inc were today's noteworthy upgrades:
Merriman upgraded shares of Syneron Medical (NASDAQ:ELOS) to Buy from Neutral following the Q1 results to reflect the introduction of LipoLite and the company's global distribution channel. They believe shares can trade towards the $22-$26 level.
Jefferies upgraded Cellcom Israel (NYSE:CEL) to Buy from Hold following the company's Q1 results to reflect its improved EBITDA outlook.
Morgan Keegan upgraded GATX (NYSE:GMT) to Outperform from Market Perform as they believe the company has increased opportunities to deploy capital given the current state of the market for railcars, which should result in share outperformance.
Suntrust raised TNS, Inc (NYSE:TNS) to Buy from Neutral citing improved execution and the global shift towards electronic transactions.
OTHER UPGRADES:
Chevron (NYSE:CVX) was raised at UBS to Buy from Neutral.
Citigroup upgraded Sina (NASDAQ:SINA) from "hold" to "buy" according toBriefing.com. The news service also reports that Tivo (NASDAQ:TIVO) was upgraded to "market perform" from "underperform" by Friedman Billings.
First Analysis Securities downgraded Cbiz (NYSE:CBZ) to "equal weight" from "overweight" according to the AP.
Douglas A. McIntyre is an editor at 247wallst.com.
It was bound to happen sooner of later. Growth of new internet users in the US has slowed. Growth in China is robust. As of February, the big Asian nation now has a many people online as America does. Both countries have about 221 people using the internet.
According to the AP "China's February figure for Internet users was a 61 percent jump over the 137 million people online reported by the government at the start of 2007."
Who cares? US internet companies for one. With China's audience so huge and growing, the next battle for web users in moving quickly to the mainland with companies like Google (NASDAQ:GOOG), Yahoo! (NASDAQ:YHOO), and Microsoft (NASDAQ:MSFT) understanding that much of their future revenue prospects will have to come in the world most populated country. Online activity in the US and Europe is close to its saturation points.
The challenge in China is that leading local companies there like Baidu (NASDAQ:BIDU) and Sina (NASDAQ:SINA) are already control much of the market. They are not likely to give up any of that share with out considerable fighting.
The Chinese market may hold the key to ongoing revenue growth for US internet companies, but, if they cannot find a big foothold there, it is a sign that their long-term growth prospects may be stunted.
Douglas A. McIntyre is an editor at 247wallst.com.
MOST NOTEWORTHY: GlaxoSmithKline, FreeSeas and SINA Corp were today's noteworthy initiations:
ING believes GlaxoSmithKline (NYSE: GSK) should benefit from the appointment of Andrew Witty as CEO and see limited downside risks. The firm initiated shares with a Buy rating.
FreeSeas (NASDAQ: FREE) was started at Oppenheimer with an Outperform rating and $8 target, as they view FREE as an early stage growth company in the smaller dry-bulk vessel segment and finds the valuation attractive at current levels.
Kaufman Bros. initiated SINA Corp (NASDAQ: SINA) with a Buy rating and $4.50 target, and believes China represents a compelling long-term growth opportunity.
OTHER INITIATIONS:
Level 3 Comm (NASDAQ: LVLT) was initiated with a Underperform rating at Wachovia.
Jefferies assumed Savient Pharma (NASDAQ: SVNT) with a Buy rating and $30 target.
Lehman initiated Brown & Brown (NYSE: BRO) with an Underweight rating.
MOST NOTEWORTHY: IPC The Hospitalist Co, Forest City Enterprises and SINA Corp were today's noteworthy initiations:
Jefferies believes IPC The Hospitalist Co (NASDAQ: IPCM) is well-positioned to grow rapidly in the next several years, as it takes advantage of numerous organic and acquisition-driven expansion opportunities in the emerging hospitalist sector. The firm started shares with a Buy rating and $27 target.
Forest City Enterprises (NYSE: FCE.A) was initiated with an Outperform rating and $47 target at Keefe Bruyette, as they find shares attractively-valued at current levels.
Sterne Agee initiated SINA Corp (NASDAQ: SINA) with a Buy citing checks that indicate trends for online advertising in China remain very favorable and support a strong growth outlook.
OTHER INITIATIONS:
Credit Suisse initiated CBS Corp (NYSE: CBS) with a Neutral rating and $25 target and Alcoa (AA) with an Outperform and $45 target.
Oracle (NYSE: ORCL) was reinstated with a Buy rating and $24 target at Goldman Sachs.
It seems that Apple Inc.'s (NASDAQ: AAPL) Jobs perfectionism isn't so perfect lately. In the past 24 hours, there have been reports that a number of the new iMacs have been freezing. These are screen freezes, with the exception of the mouse pointer, when underneath the computer keeps running. Meanwhile, it seems that perhaps Apple wasn't intentionally bricking hacked iPhones, perhaps the software update was just a bad one as even non-hacked phones have been known to brick after the update.
It seems that Google Inc's (NASDAQ: GOOG) efforts in China have paid off. Today the search giant said it is closing the gap with rival Baidu.com (NASDAQ: BIDU) in the second largest internet market in the world. Google has increased its market share after it announced its partnership with Sina Corp (NASDAQ: SINA).
eBay Inc (NASDAQ: EBAY) said it has acquired Afterbuy.com, which enables professional trading on eBay's German Website and other online marketplaces. Terms of the agreement were not disclosed.
Family Dollar Stores Inc. (NYSE: FDO) today said fourth-quarter net income rose 17% to $37.8 million, or 26 cents a share. Analysts expected earnings of 25 cents a share, according to a survey by Thomson Financial.
Microsoft Corp's (NASDAQ: MSFT) CEO said Steve Ballmer said at a press conference in Zurich that he did not rule out further acquisitions of a similar size to web advertising firm aQuantive ($6 billion). Research In Motion Ltd. (NASDAQ: RIMM) is expected to post earnings after the close today. Analysts expect a per-share profit of 50 cents for the second quarter. Shares are up some 1.8% in premarket trading ahead of earnings.
Countrywide Financial Corp (NYSE: CFC) was ordered to give confidential information about its stock-grant practices to a pension fund, according to the Los Angeles Times web site.
China stock expert Jim Trippon recently issued new buy recommendation on SINA Corp. (NASDAQ: SINA), which operates four Chinese-language web portals.
In his China Stock Digest, the advisor says, "We believe that SINA has a degree of diversity, brand strength and earnings growth potential that puts it ahead of the competition."
Trippon explains, "We believe SINA is uniquely positioned to rise in profitability with increasing web penetration in the Mainland and beyond. SINA Corporation is in the ambitious business of bringing Chinese language web access to Greater China and the rest of the world."
SINA, he notes, operates four Chinese-language web portals, serving the PRC, Hong Kong, Taiwan, as well as Chinese-speaking people in North America. The company has more than 230 million registered users worldwide and 600 million daily page views.
Baidu (NASDAQ: BIDU) volatility flat on reports of BIDU TV.
www.Baidu.com, a Chinese language internet search provider, closed at $203.21. SBSH has a $250 price target on BIDU. Smith Barney says that "according to article on www.Tech163.com and it www.sohu.com, BIDU has started to test its BIDU TV advertising display on its union sites on 8/21." BIDU September option implied volatility of 50 is near its 26-week average according to Track Data, suggesting non-directional risks.
SINA Corp (NASDAQ: SINA) option implied volatility flat at 42.
www.SINA.com, a leading online media company and value added information service provider for Chinese communities, closed at $40.30. CIBC World said on 8/7 "SINA maintains a solid market leadership position in branded advertising, supported by stable traffic growth and solid relationships with larger advertisers." SINA overall option implied volatility of 42 is above its 26-week average of 39 according to Track Data, suggesting non-directional risk.
Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
Sina (NASDAQ: SINA) reported results last night, showing revenue up 11% at $59 million. Operating income was under $13 million. The company has a market cap of $2.3 billion.
Baidu (NASDAQ: BIDU) and Sohu (NASDAQ: SOHU) both reported results last month. Revenue gains were fine, but the base is still tiny. Baidu, the largest search engine in China, had a profit of only $19 million. But, it sports a market cap of $6.6 billion. It trades at 42 times revenue, compared to Google at less than 12x.
Therein lies the mystery. China has over 130 million web users, putting it second only to the U.S. But the revenue generated from its major web portals remains remarkably small.
The issue also points to whether valuations for these companies are much, much too high. It will take them a long time to become as big as Yahoo! (NASDAQ: YHOO) which has a market cap of $30 billion.
MOST NOTEWORTHY: Winn-Dixie Stores (WINN), TIB Financial Corp (TIBB), Energy East Corp (EAS), Baidu.com, Inc (BIDU) and SINA Corp (SINA) were today's noteworthy upgrades:
Friedman Billings upgraded shares of Winn-Dixie Stores (NASDAQ: WINN) to Outperform from Market Perform citing valuation, sustainable Q3 margins, and share gains from both Wal-Mart Stores (WMT) and Publix.
Sandler raised TIB Financial Corp (NASDAQ: TIBB) off the ground, to Hold from Sell, citing valuation.
Jefferies upgraded shares of Energy East (NYSE: EAS) to Hold from Sell after Iberdrola agreed to acquire the company.
Pacific Crest upgraded both Baidu.com (NASDAQ: BIDU) and SINA Corp (NASDAQ: SINA) to Outperform from Sector Perform following their trip to Asia, citing China's strong online ad market. They believe Baidu.com is benefiting from its sales-force integration and SINA Corp's brand strength should lead to further market-share gains...
RBC Capital Markets initiated three Chinese Internet companies this morning: Baidu.com Inc (NASDAQ: BIDU) with a Sector Perform and a $124 price target, SINA Corporation (NASDAQ: SINA) with a Sector Perform and a $39 price target, and Sohu.com Inc (NASDAQ: SOHU) with an Outperform and a $33 price target. RBC believes Sohu.com is well positioned to benefit from secular growth in online advertising and is the most direct beneficiary of the 2008 Beijing Olympics, as it hosts the official site.
OTHER INITIATIONS:
Citigroup Inc (NYSE: C) was initiated by JP Morgan with an Overweight. The firm sees performance in international, corporate and investment banking improving.
Callaway Golf Company (NYSE: ELY) was initiated by Morgan Joseph with a Buy and $19 price target.
SINA Corp (NASDAQ: SINA), a Chinese online media company, is scheduled to report Q2 EPS on August 6. SINA August option implied volatility is at 78; September is at 55. SINA average option implied volatility over the last 26-weeks is 58 according to Track Data, suggesting larger August price movement. .gif){kind=logo}
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China stock expert Jim Trippon recently issued new buy recommendation on 
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