Flag Bank publishes Investment Report, reiterates 58 city buying rating

Citigroup analysts said in the study, "58 of the city's performance report exceeded Citi/Wall Street expectations, paying customers outstanding contributions." Main product line recruitment, real estate, Yellow pages are showing strong growth momentum. The company's expansion into the mobile internet sector has been robust. In view of the promotion of online advertising business and the sustainable performance of membership services, we have adjusted 58 to 2014/15 revenue forecasts 9% and 8% respectively. The target price has been lowered to 59.6 US dollars (before $48.1). PEG (P/E ratio and growth ratio) was increased from 0.60 times to 0.75 times times. Reaffirm the Buy rating. ”

The report also notes that the future will be a key window for investment. According to media reports, 58 of the same city on March 18 on the SEC website announced the first additional plan, proposed to raise 400 million U.S. dollars. The prospectus shows that funding is intended for investment and mergers, but does not show specific direction.

Since the release of the annual results, the good market response, 58 of the same city share price continued to rise, last week, the highest closed to 49.99 U.S. dollars, compared to the issue price of 17 U.S. dollars has risen nearly three times times, the market value of about 4 billion U.S. dollars.

According to public information, 58 of the City disclosed unaudited 2013 financial data, the main business income of 145.7 million U.S. dollars, an increase of 67.3%, to achieve net profit of nearly 19.6 million U.S. dollars, while the net profit margin increased 5% to about 24% of the level.

The following is a summary of the report:

Gross revenues rose 83% to $45.3 million, up 8% from the company's previous forecasts (41 million to 43 million US dollars), or 8% per cent above Citigroup/Wall Street expectations. Membership income rose 71% per cent to 26 million US dollars, driven mainly by a significant increase in pay-for-subscribers (393,000, compared with 353,000 in the third quarter of 2013 and 228,000 in the fourth quarter of 2012). Online promotion services increased 123% year-on-year.

Management gave a strong 2014 first-quarter performance guideline: Revenue is expected to reach $430.045 billion trillion, a year-on-year increase of 81-90%, a median of 11% and 9% per cent higher than Citi and Wall Street expectations.

In the conference call, management said that the number of mobile user visits remained growing, and that users were significantly more active in mobile terminals than on the PC side. Accounted for more than 40%. Mobile applications allow 58 of the city to reach the low-end businesses that cannot provide services on the PC side. For the foreseeable future, management expects mobile end user access to exceed the PC side.