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Bear of the Day: Autohome (ATHM)

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I am going to go out on a limb and say that you did not need me to know that Chinese Internet stocks were in trouble. The strange part to me is that this should have been the topic du jour during last Presidential term. I mean, we literally had a trade war. I thought that war had subsided. Apparently, we have got it all wrong. It has only gotten worse for stocks like this. Is there an end to all this?

Today’s Bear of the Day is a Chinese internet stock. That might make it seem like a pariah. I am talking about Zacks Rank #5 (Strong Sell) AutoHome (ATHM - Free Report) . Autohome Inc. operates as an online destination for automobile consumers in the People's Republic of China. The company, through its websites, autohome.com.cn and che168.com, and its mobile applications and mini apps, delivers interactive content and tools to automobile consumers. It provides media services, including automaker advertising services and regional marketing campaigns; and leads generation services comprising dealer subscription services, advertising services for individual dealers, and used automobile listing and other platform-based services. 

There are many reasons to be worried about this stock. Obviously, the fact that it is a Chinese internet stock is a big one. The other is that, over the last thirty days, two analysts have cut their earnings estimates for the current year while three have dropped their numbers for next year.

The negative moves have cut our Zacks Consensus Estimates for the current  year from $3.84 to $3.40 while next year’s number is off from $4.23 to $3.62.

Other stocks within the same industry include Zacks Rank #2 (Buy) Crexendo CXDO and Dropbox DBX.


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