US Investment information and analysis website Seeking Alpha Monday post

Lead: US investment information and analysis website seeking alpha, in a Monday article, said that both Nasdaq:cyou and Apple had a lot of cash, but the difference was that the tour was investing aggressively to boost future growth. Therefore, although the current profit margin is low, but the investment potential is big. Apple, by contrast, faces signs of aging and decline.

The following is a summary of the article content:

Its share price has fallen 23% per cent since the third quarter of October 28, with investors largely concerned about its declining profit margins. Some analysts believe that the current slump in profit margins means the company is performing poorly. It is a mistake to judge that a lower profit margin is to ensure future growth.

Cruise through its five-year plan and decide to use a lot of cash to develop mobile gaming and platform business. The cruise program invests 53 million of dollars in marketing and research and development to promote new mobile games and build your own platform.

The current price-to-earnings ratio is 3.2 times times higher. Based on current stock prices, investors have almost zero valuations for their 17173 portals and mobile gaming operations, and are also extremely low on "Tianlong eight". With an average of 99 million active users, a cruise expansion program will win more users and commercialize quickly.

The latest five-year plan is very similar to Amazon's development experience. Amazon has more than 10 years of loss experience due to its investment platform business. But investors are still backing Amazon and bringing its market capitalisation to $162 billion trillion, and no one complains about its sluggish profit margins.

Amazon's current annual revenue gain is about 20%, compared with 10% to 15%. If the cruise mobile gaming and platform business does not fail completely (and cannot fail), the pace of revenue and profit growth early next year will be swift.

Move the game part

The current mobile game is a hot business. Since the beginning of the year, the share price has risen 410%. The Shanghai Stock Exchange listed the China Green Treasure Network Technology Co., Ltd. the beginning of the year's share price rose 410%, p/e 300 times times. The share price of palm Tech (Ourpalm) has risen 440% per cent since the beginning of the year, at 200 times times earnings. All mobile gaming companies have a higher p/e ratio, compared to 3.2 times times the current rate.

In addition, unlike rivals, the tour also has a large marketing platform, and 99 million of monthly active users. Moreover, the tour also has the support of the parent company Sohu.

Valuation

Compared to competitors such as Tencent, The perfect World, giant networks, NetEase and Shanda games, the current valuations are the cheapest. But in the past four years, in addition to Tencent, the Tour's revenue rose is the highest.

On the balance sheet, the cruise has about $10 a share of cash and a 6-dollar fixed-term deposit for each share. In the third quarter of fiscal year 2013, the net operating cash flow of the tour still reached $1.81 per share under the premise of increasing research and marketing investment. In addition to cash and term deposits, investors can also earn returns by operating cash flows.

Sohu Support

Sohu's support is of great importance to the tour. Sohu has become a swimming platform, swimming can use the identity of Sohu subsidiary, through the Sohu's multiple websites to advertise, to attract Sohu's huge user base. At Sohu main site, 17173 and swim games have been placed in a conspicuous position and attracted great attention. At present, only two competitors have such resources, namely Tencent and NetEase.

Sohu is also very generous to the tour. 2011, Sohu to 163 million U.S. dollars low price will sell 17173 business to swim. Today, 17173 has become one of the core businesses of the tour.

17173 Business

In the third quarter of fiscal year 2013, 17173 of advertising revenue rose 63% Quarter-on-quarter. We believe that if 17173 is now an IPO, its valuation will reach at least $900 million trillion. Based on the Alexa data, 17173 traffic in China ranked 177, search house ranked 185, and valued up to 5 billion U.S. dollars. Where to go ranked 221, the market value of 3 billion U.S. dollars. 58 City ranked 49, the market value of 2.5 billion U.S. dollars. We believe that the 900 million dollar valuation may be too low for 17173. Unlike the cities where they go and 58, 17173 have no larger direct competitors.

Unlike Apple.

Swimming and Apple (hereinafter referred to as "Apple") all hold a large amount of cash, but the difference is that the swim in investment to promote future business growth, and Apple is a sign of aging and decline.

According to Apple's forecasts, revenue gains during the Christmas shopping season will hit a 5-year low. Apple's current market capitalisation is $468 billion trillion, the world's highest-value company, and the general valuation criteria are no longer suitable for Apple.

The value of Apple has become unimportant, and it is important how many people are willing to continue to hold Apple shares. The short-term determinants of stock prices are supply-and-demand relationships, regardless of how high valuations are. For this, there is little room for Apple's share price to continue to rise.

Without much support from the government, Apple's profits are largely dependent on an iphone product. Currently, Android phones may not have a big impact on Apple, but rivals appear every year, every month, and even daily. As a result, Apple's chances of reaching $2 trillion trillion in 5 years are certainly much smaller than the fall to about 300 billion dollars.