We have upgraded our DCF-generated fair value estimate for Sohu to $64 per ADR from $54. We now expect that Sohu’s net income to shareholders will become positive starting in 2021, as opposed to 2024 previously, owing to more upbeat management guidance and more details on plans to revive the Sohu media and video businesses. The shares are currently undervalued, and we think the key catalyst is the improved profitability of the Sohu Media and video business. We maintain our very high uncertaint...
No-moat Sohu's net loss came in at USD 92.8 million, missing guidance by 19%-36%. Net revenue growth in the first quarter clocked in at 22%, beating the high end of guidance of 16% due to online games (24% versus the top end of guidance of 18%) and the other segments (12% versus guidance of negative 28%). Management guided that Sohu as a whole will be profitable in first-half 2019 and the media portal and Sohu Video will be profitable in 2019. Sohu’s businesses excluding Sogou and Changyou are...
We maintain no-moat Sohu’s fair value estimate at CNY 54 per share and think the 16% decline in the share price post-earnings provides a good entry point for investors. Sohu’s 2017 loss before tax came in at USD 197 million, missing consensus of USD 138 million and our estimate of USD 155 million. We think the shares are undervalued, as the advertising business will see substantial improvement; other drivers include the fast growth of Sogou and gradual improvement in the subscription busines...
We maintain no-moat Sohu’s fair value estimate at CNY 54 per share and think the 16% decline in the share price post-earnings provides a good entry point for investors. Sohu’s 2017 loss before tax came in at USD 197 million, missing consensus of USD 138 million and our estimate of USD 155 million. We think the shares are undervalued, as the advertising business will see substantial improvement; other drivers include the fast growth of Sogou and gradual improvement in the subscription busines...
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