Sina Corporation (SINA) has been an Optionmillionaires favorite over the past few months.There is nothing that an option trader likes more than a volatile stock, and SINA Corporation (SINA) sure fits the bill. SINA Corporation (SINA) reported earnings after hours, and the stock rose nearly 7%. Folks were expecting a loss, which they got, but revenue was above expectations. With all the bad press as of late, it was almost a relief that SINA Corporation (SINA) expects to still generate revenues with the China censorship crackdown.
It's one of the reasons we think there will be some serious upside upgrades tomorrow. SINA Corporation (SINA) pulled in just over $100 mil in revenues for the past quarter, yet has over 300 million users of its twitter like service. If they are able to just pull in $.50-$1 per user, they will experience some SERIOUS growth. Smart "Growth Companies" sacrifice short term profits, for long term growth. Looks like Sina CEO Charles Chao is continuing to do that, which is great news in our opinion:
Sina CEO Charles Chao said: "China's macroeconomic weakness in the first quarter the Company's brand advertising business growth moderate. We expect the macroeconomic aspects of the resistance will continue until the second quarter, however, we have begun to test the water micro- Bo brand advertising business. this advertising product recommendation engine driven by the map-based social interest, is expected to be in the second half of the year for our brand advertising business real impact. the current the microblogging advertisers preliminary feedback is encouraging, we believe that to continue major investment is necessary for social media and related projects. "
Of course there are the folks looking at the news release tonight seeing this headline:
Sina Corp could see further losses due to Weibo: CEO
The market is forward looking, and think this view is very short sighted. With the penetration they have, in a market with few competitors, I think SINA has much more upside then folks are giving her.I guess we will see tomorrow. Here is what we were saying on our watchlist this morning and monday:
SINA – 60 calls before the close for me, think earnings will not be too good, but the outlook and china restrictions will be the key.
SINA – reports this week as well, with RENN. Hard to figure, but I still like SINA. Not sure of the strikes yet and may wait till Tuesday AM.
Disclosure: we hold $57.50 and $60 MAY calls