Youku (YOKU) Pops on Earnings While Analysts Remain Split

Jacob Harper  |

Shares of Chinese video sharing service Youku Inc. (YOKU) jumped in early Friday action following the Nov. 14 issuance of the company earnings report, which showed the company beat analyst consensus expectations by not losing nearly as much money as expected.

Earlier in the week, JP Morgan & Chase Co. (JPM) upgraded the stock to “positive” and Brean Capital upgraded to “buy” while raising the price target to $36 a share.

Despite the early week analyst optimism and earnings surprise, the company is not without its detractors. Following the earnings report Bank of America (BAC) downgraded the company’s stock to “neutral” from an earlier rating of “buy.”

Youku began trading on the NYSE in Dec. 2010, closing its first day at $33.44 a share. The company briefly spiked north of $60 before tumbling down in late 2011. It has languished below its IPO price ever since, as the company has consistently failed to realize a profit.

Youku merged with its main competitor, Tuduo, in March 2012, and now boasts 300 million video views per day. However, the company is still dwarfed in size by Google Inc. (GOOG) subsidiary YouTube, which is banned in China.

For their third quarter earnings report, Youku reported a net loss of $35.7 million, or $0.21 per share, versus the net loss of $49.13 million, or $0.40 per share, from the same period a year ago. Revenue for the quarter was $140.2 million, as compared to $184.53 million from the same quarter the previous year. Analysts were expecting a net loss of $0.39 per share on revenues of $139 million.

Youku popped on the mitigated losses and saw its shares rise 8.42 percent in early trading to hit $28.52 a share.

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Companies

Symbol Name Price Change % Volume
BAC Bank of America Corporation 29.30 0.31 1.07 97,928,158 Trade
GOOG Alphabet Inc. 1,098.26 8.36 0.77 1,955,559 Trade
YOKU Youku Tudou Inc ADR (Sponsored) n/a n/a n/a 0 Trade
DTSCF Deutsche Bank AG London Branch Call Wts Lkd Euro Stoxx 50 Index 02/02/2016 n/a n/a n/a 0
JPM JP Morgan Chase & Co. 104.59 1.67 1.62 16,428,710 Trade

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