I looked back at the last earnings release on Nov 13. That was also a blowout. The stock ran pretty good in the two months prior to that release...but on that day it opened at 11.50 and closed at 11.16. Again, on blowout numbers. It then popped the next day, then declined again for another week to 10 days before resuming a solid upward trajectory.
Now get this. On the August 16, 2013 release, again, on good numbers, it cratered. It closed August 15 at 6.33. It opened on August 16 at 7.26 and closed at 6.07. About a week after this, it went up hard again.
I wish I had done this work before earnings were released. There is a pattern of an initial heavy pop and then a fade to black. So this was THE THIRD TIME IN A ROW. Did not look farther back than that.
Now you see the picture?
and then the sudden dump to 14.70, which was quickly covered.
If I recollect, generally it initially sells on the sizzle. I think I remember being surprised like this 2 or 3 times in a row now. Ramps up before and then profit taking largesse takes over. Again, seems to have been that way......still do not think this will last though.
Yes, the price targets may provide us what we need for a boost in the share price. Volume is extraordinary but the earnings news is getting a yawn for some mysterious reason(s).
There’s a reason that Leju is a separate site from E-House’s main website. That’s because the site used to be jointly owned by E-House and Sina, and was part of their CRIC joint venture. CRIC was publicly listed on the Nasdaq for nearly 3 years from 2009 to 2012, but its shares never did very well and E-House ultimately ended up buying out the company in a deal that saw CRIC privatize and its shares de-list.
More broadly speaking, this kind of spin-off really does have a dismal track record among Chinese Internet companies. Two of the biggest proponents of this technique have been Shanda Interactive and Sohu.com (Nasdaq: SOHU), both of which spun off and listed several units, including their online games. But in the end, none of those performed very well, and Shanda is even in the process of privatizing its main spin-off, its online game unit Shanda Games (Nasdaq: GAME).
All of that negative history certainly doesn’t bode well for a separate Leju listing. What’s more, this latest plan looks like a veiled way to recycle an old listing using a new name to hide the fact that the old listing didn’t do well. If the old listing didn’t do well, there’s no reason to believe a new one will perform any better. Perhaps an offer could get a short-term bounce due to the current positive investor environment for China Internet stocks, but it’s unlikely to maintain any gains over the longer term.
Bottom line: E-House is likely to move ahead with a plan to separately list its Leju unit and could get a short boost after an IPO, but the offering is likely to stall over the long term.
Wet blanket article....may account for the dismal showing this far on stellar earnings and revenue......................After an unsuccessful earlier listing for one of its units, online real estate giant E-House (NYSE: EJ) is preparing to try again with plans for a New York IPO for its Leju division. The company has been quite cagey in this latest listing plan, giving little details about Leju’s background and why the unit deserves its own separate listing. Perhaps that’s because a little checking reveals that this “new” offering is really just a recycled listing for a previous company jointly-owned by E-House and leading web portal Sina (Nasdaq: SINA).
All this raises the bigger issue of a decidedly checkered history for this kind of move, which sees Chinese Internet companies spin off their smaller individual units for separate listings. In theory this kind of spin-off is a good idea as it creates more “pure play” choices for investors, since big companies like Tencent (HKEx: 700) and Alibaba often have many different businesses in their portfolio. But the reality is often quite different, and history has shown that these spin-off IPOs seldom do well.
All that said, let’s return to the present where E-House says it has made its first filing with the US securities regulator for a Leju IPO on either the New York Stock Exchange or the Nasdaq. (company announcement; Chinese article) The whole situation is still very preliminary, as E-House says it hasn’t decided how big the offering might be. The only additional information it gives is to say it will remain Leju’s majority shareholder after the offering.
It’s clear from the announcement that this initial move isn’t a public filing and that E-House is voluntarily announcing the plan to test market reaction. The company’s shares rose 3.6 percent after the announcement came out, and were up another 2.6 percent in after-hours trade, indicating investors were interested and that E-House is likely to move forward
I think this could be about the 10th up day in a row where the stock has popped significantly and returned to at least the flat line. The trading pattern appears to be cut in stone so why not play it?
That is, Weibo and Tencent.
Zhou says market is stable.
Lending platform should be huge. He said it TWICE.
New services just announced NOT included in 2014 revenue forecast. So basically they will BLOW AWAY the high end of the forecast.
Focus Media also involved. Big advertiser.
Asset light business model. Translated...the vast majority of rev flows to the bottom line.
Will announce more concrete initiatives in the near term.
The stock was in the 12's a few days ago so those who took large positions are not taking any chances and exiting with their 15-20% gain in a few days. No question about that. Cannot blame them either.
I should think this spin off news will only make the conference call more interesting. My bet is in a positive way. They are attempting to unlock some shareholder value here, no question more for themselves, but owners of EJ stock in essence are going to get a dividend. That is, shares in the new company.
battle going on here in the early trading. Evidently lots of folks bought in early having known the news, now some, or many, are deciding to take their money and run. Trading this stock no different than a weekend trip to Vegas.