Morgan Stanley to maintain a swim reduction rating target price to 23.4 U.S. dollars

Beijing Time November 4 Evening News, Morgan Stanley released its investment report today, maintaining a nasdaq:cyou "reduction" rating, the target share price from 22.40 U.S. dollars to 23.40 dollars.

The following is a summary of the contents of the report:

The third-quarter results of the 2014 fiscal year were not surprising, but the company unexpectedly announced management changes. This may help resolve some of the unresolved issues caused by internal contradictions, but the company's profit outlook remains bleak. To this end, we continue to hold a tour of the stock "reduction" rating.

Company CEO resigns: Tour CEO Wang Tao has resigned for personal reasons, but continues to serve as a company director. The Board of Directors has appointed Sohu President and Chief financial Officer Yuchuyan and tour company president Chen Deven as the joint CEO of the tour. We believe that management changes will lead to more changes in the overall strategy and will be the most important factor in the future performance of the Tour.

High revenue and low spending trends will be maintained in the near future: We believe that the recent introduction of the two mobile games "Qin Dynasty Moon 2" and "Tianlong eight 3D Edition", as well as "Tianlong eight" and other games of the new information, help offset the "Divine Comedy" and "Pinball Hall" of the downturn. However, the "Qin Dynasty Moon 2" and "Tianlong eight 3D version" of the two mobile games of the sustainability of the unknown. We anticipate that management changes will lead to a marketing strategy and internal structural optimization that helps to reduce sales and marketing expenses.

Game users bounce: The third quarter, the total average monthly active user number of 29 million, down 6%, but the chain growth of 21%. "Tianlong Eight" the number of active users of the chain continued to rebound. We believe that the fourth quarter's contribution to mobile gaming will increase further. Later this month, the tour will launch several new mobile games.

Valuation: We continue to maintain a "reduction" in the share of the shares, the target price from 22.40 U.S. dollars to 23.40 U.S. dollars. (Li Ming)