The target price of China Merchants Securities has risen from 56 to 90.7

The following are the main contents of the study:

Alibaba to promote micro-bo monetization process, maintain "buy"

August 12, 2013, Sina released 2013 years of Q2 performance, sales growth of 20%, to 158 million U.S. dollars, micro-blog advertising sales growth of 209% to 30 million U.S. dollars. Although due to the development and management costs accounted for a larger increase, reduced the 2013-year EPS from $0.73 to-$0.33, based on the company and Alibaba Micro-bo monetization cooperation is good, we increased the 2014, 2015 EPS from $0.94 to $2.51,$1.25 to $ 4.49, to increase the target price from $56.0 to $90.7 to maintain its "buy" rating.

2013 Q2 Performance Review

Although the microblogging advertising business is also affected by the seasonal factors, but in the Q1 off-season growth rate is still higher than the portal, Q2 growth is far more than the portal, from a side of the advertising business for micro-BO This emerging media model of favor. The current rise in Weibo costs is mainly due to the rise in research and general management costs. With the deepening of the cooperation between Weibo and Alibaba, it is expected that the proportion of future research and development and general management fees will revert to the level before Sina.

Micro Bo user Active degree of steady growth, the site drainage effect is obvious

2013 Q2 continued to maintain a good development, its daily active users reached 54 million people, an increase of 47.8%, indicating that in the mobile end of the app in an endless stream of cases, micro-blog active user growth into a stable period. In addition, 2013 4-May, Weibo's independent access to users, times, page views and spending time in China's social networking site is the absolute leader. Weibo is also increasingly becoming an important tool for Web site content dissemination channels and web site drainage.

Weibo affects users ' shopping habits, and electronic business websites are popular with Weibo users

Microblogging is increasingly becoming the source of user access to shopping information, users of electricity Shang commodity purchase information to receive a higher variety or fast consumer goods, and the Shang information needs are also focused on discount promotions, product comparisons and product introduction and other basic information. In a large number of short chains on Weibo, electric and entertainment websites are popular with users.

Alibaba to help Micro-bo monetization, the future cooperation space is huge

The partnership with Alibaba has named the direction for its short-term monetization. After the microblogging account and Taobao account opened, both sides through the user to buy data will develop new products. Taobao through the introduction of the window with Sina Services, the use of users in micro-blog usage, bo content, and so on, accurate recommendation of products, so as to improve its product short chain on the microblogging share, clicks and reflux ratio.

Investment Strategies and Recommendations:

We expect Q3, Weibo's own ad sales (including display and information flow) to be $30 million trillion, with sales from Alibaba increasing to $10 million. Using the average value of DCF method and partial valuation method, the company's reasonable values are $90.7 per share, corresponding to the 2014 P is 36 times times, maintain the rating of Sina "buy".