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Weibo (WB) Touches 52-Week High on Solid Growth Drivers

SFLY TOUR ANGI WB

Trades from $3

Shares of Weibo Corporation (WB - Free Report) rallied to a new 52-week high of $55.59, eventually closing a tad lower at $54.34 on Oct 4. This represents a whopping one-year return of approximately 316.4%,compared with the S&P 500’s return of 8.6% over the same period.

Notably, the stock has a market cap of $11.26 billion.

Key Factors

Weibo operates as a social media platform for people to create, distribute and discover Chinese-language content. The company operates in two segments: Advertising and Marketing Services, and Other Services.

Weibo reported strong second-quarter 2016 results wherein both earnings and revenues exceeded the Zacks Consensus Estimate. Net revenue came in at $146.9 million, surging 36% on a year-over-year basis. Notably, advertising and marketing revenues increased 45% to $127.2 million on a year-over-year basis.

Moreover, management provided strong revenue guidance for third-quarter 2016. Revenues are expected in a range of $168 million to $173 million.

The growing trend of social marketing is helping Weibo to gain traction. Additionally, strong user growth in the mobile space propelled by live video and short video are also helping the company to stay ahead of the growth curve. Weibo’s financial model too provides impetus to the company’s strong operating leverage.   

Estimate Revisions

The Zacks Consensus Estimate for fiscal 2016 increased by three cents to 53 cents over the last 7 days. Also, for fiscal 2017, estimates surged 18.5% to $1.09 per share over the same time frame.

Currently, Weibo holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

WEIBO CORP ADS Price and Consensus

WEIBO CORP ADS Price and Consensus | WEIBO CORP ADS Quote

Key Sector Picks

Better-ranked stocks in the sector include Angie's List, Inc. (ANGI - Free Report) , Shutterfly, Inc. (SFLY - Free Report) and Tuniu Corporation (TOUR - Free Report) . While Angie’s List and Shutterfly sport a Zacks Rank #1, Tuniu carries a Zacks Rank #2.

Estimates for Angie’s List for both 2016 and 2017 remained steady at 7 cents and 12 cents, respectively over the last 7 days.

Similarly, 2016 and 2017 estimates for Shutterfly remained steady at 56 cents and $1.05 over the same time frame.

The loss estimate for Tuniu for 2016 narrowed down to $1.96 from $2.26 earlier over the last 60 days.

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