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TH Capital Outlines SINA's Headwinds

Luke Jacobi

SINA (NASDAQ: SINA) shares are trending higher despite a downgrade from T.H. Capital from Buy to Hold. Analyst Tian Hou highlights two primary headwinds.

Video License

SINA had its online video license revoked by the Chinese government, disrupting its ability to capitalize on advertising sales.

Hou wrote: “The World Cup started on June 12 and ended on July 13, and Sina normally would benefit significantly from such a big event. However, due to the government’s crackdown of unhealthy content on many websites, Sina’s online video licenses were revoked in April 2014.”

Investment Lag

The research report further stated that SINA’s investment to capitalize on growing mobile and internet users lags competitors.

“In addition, its portal business seemed to be left behind by many changes in China’s internet and mobile world. Sina needs to rejuvenate its portal business by investing in verticals and mobile.”

Price Action

Shares of SINA were last trading 1.9 percent higher at $48.47.

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