Pacific Crown Securities today released a study to keep Sohu (Nasdaq:sohu) shares and the market flat rating

The following is the full report:

A big increase in spending associated with a cruise platform strategy will affect Sohu's 2014-year profit. We will remain on the sidelines until we understand the duration of Sohu's spending growth, or the increased profitability of the search business and video business.

-third-quarter results were slightly better than expected. Sohu's third-quarter revenue was $368.3 million trillion, above our estimated 364 million dollars. The earnings per share, excluding one-off dividend costs, are 0.48 dollars better than our estimated $0.43 trillion.

-Growth in spending will result in net losses for the quarter. To further strengthen the platform strategy, the tour is expected to increase spending in the fourth quarter of 53 million dollars. Therefore, Sohu forecast quarterly net loss will be 0.30 to 0.35 U.S. dollars, but the median revenue forecast growth of 4% to 384 million U.S. dollars.

-The end time for expenditure growth is unclear. The duration of Sohu's spending growth is still uncertain. The management said the current investment project is likely to continue into the second quarter of 2014, and 2014 will be the year of investment.

-Advice to stay on the sidelines until the predictability of spending is clearer. Because of the uncertainty of marketing spending itself, we will remain on the sidelines until we have a better understanding of the duration of the spending growth plan, or see the strategic benefits of a cruise platform strategy.