Hong Kong investment bank days Hao Capital said to maintain the era of holding ratings

Summary: Check the latest quotes Beijing time August 4 Evening News, Hong Kong investment bank days Hao Capital released a study today, to maintain the gathering time (NASDAQ:YY) stock rating. The following is the full report: Gathering time will be released on August 6 after the U.S. stock market closed to see the latest market

Beijing Time August 4 Evening News, Hong Kong investment bank Day Hao Capital released a study today to maintain the "holding" of the stock of the era (NASDAQ:YY) rating.

The following is the full report:

The gathering period will be released on August 6 after the U.S. stock market closed the second quarter results, and will be the Eastern Time August 6 21:00 to hold earnings conference call. We believe that, as a result of the music business, the Gathering time will be released in line with the expected or better second-quarter results and third-quarter performance prospects. New businesses, including online education and mobile social networks, will drive future growth, but these businesses are not yet fully launched. Therefore, we maintain the "hold" rating of the gathering time.

Second-quarter results are expected to be at least as expected or better than expected due to the growth in the number of music business users

According to our private data, the average number of online users (ACU) grew by 15.2% in the second quarter, on average, with the era platform, including music shows, game broadcasts, and membership services, while analysts projected a 13.5% per cent quarter-on-quarter growth rate. On the page tour transport business, although the overall growth of more than 140 new servers may slow to 8.6%, but the exclusive licensing page of the "Wind and cloud" is likely to better convert users into paid accounts. In the second quarter, the game added about 518 servers, accounting for 1/6 of the total number of new servers in the quarter. We expect net revenue for the second quarter to be $123.1 million trillion, up 14.8% per cent on a month-on-month basis, slightly above the average analyst's estimated $121.7 million trillion. Accordingly, we expect that the non-US GAAP in the gathering era would yield 0.60 U.S. dollars per share, above the analyst's average estimated $0.58 trillion.

Our data show that in the first half quarter of the third quarter, the number of users in the music business rose to an accelerating trend

Our data show that as the music show business is growing in number of users, the average forecast of the current analyst's revenue growth of 7% per cent quarter-on-quarter may be conservative. According to our private data, as of July 25, the average number of simultaneous online users in the music business may have increased by 21% in the current quarter, compared with the second-quarter acceleration. In addition, the new page tour "unparalleled" may continue to attract the momentum of paying users. So we believe that the gathering age is likely to release at least the expected, or better than expected, third-quarter performance forecasts, above the analyst's average estimated 132.3 million U.S. dollars, that is, the quarter-on-quarter growth of 7.6%.

New business not fully developed to drive future growth

We believe that the future growth of the gathering age will be driven by a successful new business. There are some uncertainties in this regard: 1 the implementation and development of the new online education business 100 Education Network. This will take longer to prove, so the business will not contribute to revenue in the short term. 2 The development trend from PC platform to mobile platform requires higher investment. A large part of the gathering time platform comes from a pc-based, massively multiplayer Online (MMO) game, which may not be easily diverted to the mobile end. The mobile music business, for example, faces other services, such as competition to sing. The recent introduction of mobile social Applications "Hello", but did not achieve faster development, download is limited.

Performance expectations Adjustment

We will raise the earnings of the second quarter of the gathering and non-US general accounting standards from 112.4 million dollars and 0.53 US dollars to 123.1 million dollars and 0.60 dollars respectively, to raise the 2014 revenue and non-US GAAP earnings per share from USD 471.9 million and USD 2.20 to $502.9 million and USD 251 million, to 20 15 revenue and non-US GAAP earnings per share were raised from USD 659.4 million and USD 3.02 to $709.1 million and $3.50. We have 945.6 million US dollars and 4.58 U.S. dollars per share of revenue and non-US GAAP for 2016.

Valuation

According to our forecasts, the 2015-year forward earnings ratio for the gathering era is 22.5 times times, compared to 21.3 times times that of the same industry companies, including leading Chinese internet companies. In the past, the stock's 12-month forward earnings ratio averaged 33 times times higher than the industry average. At present, the online education and mobile services in the gathering era are uncertain, so they cannot support the higher valuation multiples. Therefore, we maintain a "hold" rating and will look at the turning point in the company's new business.

Risk

1 Business is too concentrated, game advertising and a large part of the music business by the alliance operation; 2. Investment in online education and mobile business in the 2014 could put pressure on profitability; 3. There may be regulatory risk in the application of the time of the gathering; 4. More intense competition may make it difficult to attract and create new content in the gathering age; 5 The history of business models is relatively short; 6. Communication with Wall Street may be inexperienced. (D-Gold)