|Bid||0.00 x 1300|
|Ask||0.00 x 3000|
|Day's Range||17.77 - 18.85|
|52 Week Range||14.35 - 32.46|
|Beta (3Y Monthly)||N/A|
|PE Ratio (TTM)||17.06|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||22.03|
Stock futures: About a dozen states reportedly plan a Big Tech antitrust probe, likely ensnaring Apple, Facebook, Amazon and Google. Baidu, spinoff iQiyi and Fabrinet moved on earnings.
NEW YORK, NY / ACCESSWIRE / August 19, 2019 / Iqiyi, Inc. (NASDAQ: IQ ) will be discussing their earnings results in their 2019 Second Quarter Earnings to be held on August 19, 2019 at 8:00 PM Eastern ...
iQiyi Inc. , a streaming platform in China commonly compared with Netflix Inc. in the U.S., passed the 100-million-subscriber milestone in an earnings report released Monday, but shares fell more than 10% in late trading as financial results came in a bit lighter than expected. iQiyi reported a fiscal first-quarter net loss of 2.3 billion renminbi ($339 million), or RMB3.22 a share, on sales of RMB7.1 billion, roughly $1 billion in U.S. currency. Analysts on average expected the company to report a loss of 3.17 renminbi on revenue of RMB7.16 billion. Total number of subscribers was 100.5 million, up nearly 50% from 67.1 million a year ago with 98.9% paying for the service. The company also undershot analysts' expectations with its second-quarter forecast, guiding for revenue of 7.21 billion to 7.63 billion renminbi, while the average analyst forecast was for 7.98 billion renminbi, according to FactSet. U.S. ADS's for iQiyi closed with a 5.9% gain at $18.08, but fell lower than $16 in after-hours trading following the report.
BEIJING, Aug. 19, 2019 -- iQIYI, Inc. (NASDAQ: IQ) ("iQIYI" or the "Company"), an innovative market-leading online entertainment service in China, today announced its unaudited.
It was a message meant to warn investors that stocks were in jeopardy. But, as has been the case for months now, investors ignored the warning.The message in question came from Morgan Stanley's chief United States equity strategist Mike Wilson, who noted on Monday that "The puts have expired." In other words, "With the Fed's first rate cut in a decade not having the desired effect on markets and a trade deal looking less likely every week, these two puts (the Fed and Trade Deal) may have expired, leaving investors facing the potential reality there is no second half rebound coming."InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe market may have shrugged off the warning and sent the S&P 500 up to the tune of 1.3%, on the heels of comments from Commerce Secretary Wilbur Ross. The country's chief business development leader explained in a Fox Business news interview that the government had extended a temporary license allowing an otherwise-banned Huawei to do business with U.S. partners.The added 90 days not only gives its American customers time to make alternative arrangements, but tacitly suggests the current administration is becoming more flexible on trade matters. The Nasdaq Composite outpaced the S&P 500, rallying 1.4% in response to the easing trade tensions with China. * 7 Safe Dividend Stocks for Investors to Buy Right Now The unwinding of last week's inversion of the bond yield curve may have played a role in re-inflating confidence as well. Top News in the Stock Market TodayPG&E Corporation (NYSE:PCG) isn't out of the woods yet, it seems. Shares of the utility company implicated in last year's California wildfires had been on the mend. PCG hit bottom in January, when it appeared regulators and lawyers weren't looking to destroy it. Last Friday, however, a U.S. bankruptcy judge determined that an $18 billion suit against the company for damages and death could proceed after all, even during bankruptcy proceedings. The news sent PCG stock down by 25% today.Sina (NASDAQ:SINA) rallied 15% on Monday, after reporting earnings of 73 cents per share on revenue of $533.1 million. Analysts were only calling for a top line of $510.2 million and earnings of 47 cents per share.The move would inspire other Chinese stocks higher, boosted by hope for repaired trade relations. Weibo (NASDAQ:WB) was one of them. Compared to Twitter (NYSE:TWTR), WB stock jumped 14% on Monday in step with other Chinese names after posting a solid second-quarter earnings beat of its own.Bio-pharma name Jaguar Health (NASDAQ:JAGX) reported on Monday that its Crofelemer had proven effective as a means of controlling diarrhea in dogs that had been dosed with tyrosine kinase inhibitor. Tyrosine kinase inhibitors are a means of fighting cancer in human patients, but they can cause dire side effects. Jaguar Health hopes to use Crofelemer in human clinical investigations in the future. Big MoversA relatively obscure Zscaler (NASDAQ:ZS) took center stage on Monday, falling 11% after OTR Global downgraded the cybersecurity name. Over the course of the past 12 months ZS shares had doubled in value. This made the stock an easy profit-taking target.Bouyed by Sina, Chinese stocks also bounced on possibly improving trade ties with the United States as well. However, it was stocks of companies that digitally serve Chinese consumers that led the way. Iqiyi (NASDAQ:IQ), sometimes referred to as the Netflix (NASDAQ:NFLX) of China, gained more than 6% headed into its post-close earnings report that had some investors hopeful.Baidu (NASDAQ:BIDU) was up more than 8% in front of its earnings report slated for release after the closing bell rang as well.As of the time of this writing, James Brumley did not hold a position in any of the aforementioned securities. To learn more about James, visit his site at jamesbrumley.com, or follow him on twitter at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post Stock Market Today: Baidu and Sina Lead a Recovery of Chinese Stocks appeared first on InvestorPlace.
In general, equity markets represent investor confidence. Since late July, most tech stocks have been declining amidst the bearish sentiment in the global and United States markets. It is no secret that the Chinese economy is beginning to feel the effects of the ongoing trade war. Other global powers, such as Japan, the United Kingdom and the European Union, led by Germany and France, are also showing signs of a slowdown. And earlier in the week, Argentina spooked the Latin American markets when its currency and equity markets lost a third of their value overnight.In other words, unless we have a swift resolution on the trade war front, spending by the U.S. consumer may not be enough to improve economic prospects globally.Therefore, investors are wondering what may be next for many of the tech stocks in their portfolios. Today, I'd like to discuss three tech stocks to avoid in the second half of August and possibly in September, too. These stocks are Baidu (NASDAQ:BIDU), Roku (NASDAQ:ROKU) and Tesla (NASDAQ:TSLA).InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Cyclical Stocks to Buy (or Sell) Now Investors may consider waiting on the sidelines if they do not currently have any positions open in these tech stocks. If they already own shares, they may either consider taking some money off the table during this market bounce or hedging their positions. As for hedging strategies, covered calls or put spreads with Sep 20 expiry could be appropriate as straight put purchases are likely to be expensive due to heightened volatility.With all of that in mind, let's dive a little deeper into each of these stocks. Stocks to Sell: Baidu (BIDU)Source: testing / Shutterstock.com Notable Risks: Valuation, questions about growth, trade wars and broader tech market weaknessPossible Price Range: $85-$105During the past year, the BIDU stock price is down 55%. On Sep. 21, 2018, the shares saw a 52-week high of $234.88. Now, Baidu stock is hovering around $95. Clearly, the bears have taken control of the tape.What is the main reason for the deterioration of Baidu's market cap? Investors fear that the company's growth narrative does not hold any more.BIDU has two sources of revenue: * Internet advertising business (which is at the core); and * Income from majority ownership in iQiyi (NASDAQ:IQ)The tech market in China has grown exponentially in the last decade. And Baidu stock has been able to ride that wave. Baidu has over 70% of the Chinese online search market share. Until about a year ago, this leadership has meant growing advertising revenues and solid margins.However, that is not the case anymore. Competitors like Alibaba (NYSE:BABA) and Tencent (OTCMKTS:TCEHY) have been pressuring its business model and ad revenues. Many Chinese consumers are using apps that bypass browsers and thus Baidu's search engine. In other words, BIDU stock's desktop search business is being disrupted or even displaced.Wall Street is not sure if management knows how to go after the challenge to Baidu's core business. The company has increased spending to attract more advertisers, which in turn has affected margins. In other words, the company spends a lot of cash to make some money.Furthermore, as the Chinese economy slows down, all these companies chase the same advertisers, who have been scaling down ad budgets.The second factor adversely affecting Baidu's top-line growth comes from its ownership of iQiyi, the so-called Netflix (NASDAQ:NFLX) of China. Baidu still owns roughly two-thirds of iQiyi, so IQ's results and its growth are reflected in Baidu's consolidated numbers. And iQiyi stock is not making any money at this point either.Management at iQiyi has underlined that as the company further invests in technology and builds content, the cost of revenue would be high -- therefore the company will not be profitable any time soon.And when you add the uncertainty around trade wars, it may just not be fashionable to buy BIDU shares in 2019. Overall, the bull thesis supporting BIDU stock is falling apart. It would be important to analyze the next earnings report expected in November to see if Baidu stock has a better investment proposition for long-term investors.From a time and price analysis perspective, I'd expect BIDU stock to reach a 52-week low around Sept. 21. Until then, I'd not get too bullish on Baidu shares. Roku (ROKU)Source: JHVEPhoto / Shutterstock.com Notable Risks: Profit-taking, rich valuation and broader tech market weaknessPossible Price Range: $135-$155ROKU stock has been on a tear this year. Year-to-date, Roku shares are up 135%. However, it might now be time for investors to become cautious.With a market cap of $11.7 billion, Roku stock is the largest over-the-top streaming content provider in the U.S. On Sept. 17, 2018, ROKU stock hit a 52-week high at $198.23.U.S. consumers are fast moving from traditional pay-TV services to streaming delivery services. Advertisers are following those viewers. That's reason number one why, longer-term, I would not bet against Roku shares whose revenue increasingly comes from advertising. However, there is likely to be some further profit-taking in ROKU stock in the next few weeks.Roku has been a pioneer in streaming video gadgets. The company's revenue can be divided into two segments: "Player" which represents sales of its digital media boxes and "Platform" which includes advertising sales, licensing and other non-hardware revenue sources.At present, Roku and Hulu, the video streaming service that is majority-owned by Disney (NYSE:DIS), are the market leaders in over-the-top advertising. OTT ads are shown on a TV screen through a smart TV or streaming device.Roku is a growth stock, but it's also a speculative one. Long-term ROKU bulls happily highlight many of Roku's competitive advantages, starting with the platform's first-mover advantage in OTT advertising, share of smart TVs sold in the U.S. and projected annual growth of over 30% in the rapidly expanding over-the-top streaming market.On the other side of the coin are the nervous investors and short-sellers who are looking for any excuse to short ROKU stock. If Roku cannot keep up with the aggressive growth assumptions, then shareholders may become more concerned with low profits as well as its margins and the stock price could easily suffer. In other words, could ROKU stock price be getting ahead of itself? * 8 Dividend Aristocrat Stocks to Buy Now No Matter What Therefore, I'd encourage retail investors to exercise caution with Roku stock until the next earnings report, expected in October. Tesla (TSLA)Source: Sheila Fitzgerald / Shutterstock.com Notable Risks: Fundamentals, profit-taking, trade wars and broader tech market weaknessPossible Price Range: $180-$230When Tesla released worse-than-expected second-quarter 2019 earnings on July 24, many investors possibly ended up with more questions than answers on what to expect from Tesla stock for the rest of the year.Before reporting earnings, TSLA stock closed at $264.88. The next morning it opened at $234.50. Now Tesla stock price is hovering around the $220-$225 range.Investors usually can get a sense of any current and future problems by looking at operational and market performance as well as at basic financial metrics and cash flow. In Tesla's case, we may have a combination of signs of difficulty.The past year has seen the demand for electric vehicles decline in the U.S. And Tesla's Model 3 sales have not been at the levels expected.Tesla's Q2 results showed that the gross margin of its automotive segment is declining. Last quarter, it was 20.2%. In Q4 and Q3 of 2018, the metric was 24.3% and 25.8%, respectively.The main reason behind the decline of the company's gross margin is that Tesla's sales mix is increasingly shifting from higher-priced S and X models to the Model 3. Model 3, which is priced at $35,000 is an entry-level car that carries lower margins.As we discuss Tesla's problems, we have to mention that the auto sector is susceptible to the trade-war risk. As the demand in the U.S. declines, Tesla needs to achieve increased sales numbers from overseas, namely China, the largest electric vehicle market in the world.In late 2017, Tesla and the Chinese government agreed that the company would manufacture cars in China, and build and own a factory in Shanghai.TSLA is continuing to build its manufacturing plant in Shanghai. However, the details as to when actual production will begin at the plant is sketchy. Tesla is yet to release definite dates and production goals for the plant.At this point, TSLA stock has had several months of poor performance, both in terms of metrics and the stock price. Therefore, before committing any capital into the shares, I'd like to see the next earnings statement, expected in late October. By then, we might even have an earnings warning statement, which would send the stock even further south.At this point, Tesla bears have the upper hand and I'd consider investing in TSLA stock as a speculative bet.As of this writing, Tezcan Gecgil did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post 3 Tech Stocks to Avoid (or Sell) for Now appeared first on InvestorPlace.
Baidu's earnings this evening could be pivotal for the firm as investors evaluate whether Baidu can revitalize grow and remain profitable.
NIO (NYSE:NIO) scared off investors when it posted July deliveries that underwhelmed the markets. This sent the stock firmly below the $3.00, a level that could have found support. Instead, NIO stock price traded recently at $2.82.Source: Shutterstock Investors will have to wait for the next two weeks before either committing to the stock or dumping it at a loss. NIO is scheduled to report earnings before the market open on Aug. 27. NIO Stock Fell After Weak July DeliveriesNIO reported that deliveries totaled 837 vehicles in July, consisting of 673 ES6s and 164 ES8s. As investors will recall, the ES6 is a 5-seater premium electric SUV. The ES8 is a 7-seater but also comes in a 6-seater variant.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Stocks Under $5 to Buy for Fall Cumulative deliveries for both models reached 19,727. The company blamed a voluntary battery recall and deliveries pushed forward into June for the weaker numbers. China's unfavorable macroeconomic and auto market conditions remained challenging for NIO. Needless to say, the U.S.-China trade conflict hurt sales. To top it off, NIO faced a declining trend: the drop in passenger vehicle sales on a year over year basis for 13 of the last 14 months.NIO is optimistic that the ES8 battery recall will improve user confidence. With safety and quality assured, the brand will still have a strong reputation that resonates with its customer. NIO is free to turn its attention back to promoting stronger sales.Now that the battery capacity allocation is back to normal, NIO will accelerate deliveries to make up for the delivery loss due to the recall. Management forecasts stronger August deliveries and aims to deliver between 2,000 and 2,500 vehicles. Markets Ignore NIO's ForecastMarkets failed to recognize NIO's delivery number will triple from 837 vehicles in July to as many as 2,500 vehicles. At a share price below $3.00, NIO's market cap is just one-tenth that of Tesla's (NASDAQ:TSLA) market capitalization of $39 billion. So, when NIO is losing just as much as Tesla on an earnings per share basis, NIO stock looks like a stock worth speculating on.Still, markets may see a lesser value in NIO than in Tesla because of its potential for profitability. In the last few quarters, NIO's operating costs grew faster than its revenue. Tesla may see profitability through growing worldwide sales sooner than NIO does.When NIO depends mostly on China for its revenue, investors also face geographic risks. The ongoing U.S.-China trade war sees no signs of ending. Persistent or rising tariffs levied against the country will hurt everyone involved. Since Chinese spending levels are sensitive to the country's economic health, any decline will hurt NIO deliveries. After all, NIO's EVs are premium products that are more expensive than conventional gas-powered automobiles. Longer-Term Prospects for NIOInvestors speculating on NIO stock need to have the conviction that the long-term demand for its vehicles will continue growing. Assuming revenue growth outpacing operating cost growth in the years ahead, NIO will eventually reach profitability. Alternatively, investors who are unsure how the tariff and politics will play out may simply sit on the sidelines for now. In doing so, this group of investors will miss out on any big rally.In sitting on the sidelines, investors just need to wait and see what happens to NIO stock after the quarterly earnings report. More recently, one Wall Street analyst from Merrill Lynch issued a "sell" call and a $3.00 price target of just $3.00 (per Tipranks). And short float is a lofty 22.4%. The Chinese EV supplier clearly has many bears betting against its prospects.Ahead of the upcoming report, the average EPS estimate is a 27-cent loss on revenue of $176.28 million. In the last quarter posted on May 28, NIO reported a loss of 37 cents on revenue of $236.12 million. Your Takeaway on NIO StockInvestors have plenty of China-based stocks trading at sharp discounts. Although stocks like iQIYI (NASDAQ:IQ) and Baidu (NASDAQ:BIDU) are not in the EV space, they are examples of stocks trading at yearly lows. Investors could speculate on NIO and might get rewarded once the trade war ends.For those on the sidelines with NIO stock, buying better-quality names like JD.com (NASDAQ:JD) and Alibaba (NYSE:BABA) is another viable option to pursue.As of this writing, Chris Lau did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post NIO Could Be Worth Betting on at Below $3 appeared first on InvestorPlace.
iQIYI (NASDAQ: IQ ) announces its next round of earnings this Monday, August 19. Here is Benzinga's everything-that-matters guide for the Q2 earnings announcement. Earnings and Revenue Based on management's ...
It doesn't take a genius to point out iQiyi (NASDAQ:IQ) has been in a bearish trend. But looking forward and with earnings on tap, both off and on the price chart IQ stock's pain looks far from over. Let me explain.Source: Shutterstock iQiyi has been hailed as the Netflix (NASDAQ:NFLX) of China. But IQ stock actually operates a lot more like an amalgam of Netflix, Alphabet's (NASDAQ:GOOG, NASDAQ:GOOGL) YouTube and Amazon's (NASDAQ:AMZN) Twitch. It sounds interesting, but the IQ story faces an uphill battle which it's unlikely to conquer.Off the chart, IQ stock has delivered large and indefensible losses which aren't going away anytime soon. The trend of producing original but very costly content has only continued to increase. In fact it absorbed a staggering 79% of iQiyi's revenue in Q1 and up 38% from the prior year.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBottom line, competing in today's streaming video market is a serious threat in IQ stock's ability to reach profitability -- unless IQ stock miraculously produces a great deal more revenue growth than the company has so far. But don't hold your breath.With China's economy continuing to weaken and ad revenues from the company's YouTube inspired business shrinking, the reality of profitability for IQ stock is even further out of reach. And as InvestorPlace's Mark Hake points out, with a massive annual cash burn rate of 53%, iQiyi's difficulties are even more pronounced. * 10 Cheap Dividend Stocks to Load Up On And it only gets worse for IQ stock. The company has a couple of other big problems. iQiyi is being challenged by much larger, profitable and well-capitalized Chinese tech giants Alibaba (NYSE:BABA) and Tencent (OTCMKTS:TCEHY). Not only do these companies have the wherewithal to absorb losses to gain market-share, they're in position to stay the course, even if today's slower growth environment becomes a full-blown recession.Lastly, there's also IQ's price chart. It's our technical view iQiyi shares aren't in position to win over any fans, except perhaps bearish traders comfortable with shorting stock. IQ Stock Daily Chart Following a very brief respite which saw shares surge higher and unsuccessfully challenge the 200-day simple moving average earlier this summer, it has been all downhill for IQ stock investors. And right now, shares of IQ are setting up in a bearish pattern pointing at even lower prices.Specifically, IQ stock has formed a flag under price support which preceded the jump in share price and beneath the 76% retracement level. That's not good news for bulls. Moreover, with stochastics curling into a bearish crossover inside neutral territory, iQiyi is in position for shorting. Trading IQ Stock Gaining short exposure in IQ stock before the company reports next Monday looks approachable. But the possibility of increased earnings volatility, which can work against the position, needs to be respected. As much, and for those seeking a bearish position in front of the iQIYI report, I wouldn't recommend shorting shares outright. But that doesn't mean you can't trade IQ stock.Instead, I'd suggest using a slightly out-of-the-money bear put spread. One favored vertical of this type is the weeklys Sep 27 $16/$14 put spread for 50 cents. Unlike short stock, a bearish vertical spread can control and reduce risk to the debit paid and offer big-time profits in the event iQIYI stock trades aggressively lower.Investment accounts under Christopher Tyler's management do not currently own positions in any securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. . For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post iQiyi Stock Will See Lower Prices appeared first on InvestorPlace.
In the latest trading session, iQIYI, Inc. Sponsored ADR (IQ) closed at $16.97, marking a +0.24% move from the previous day.
iQIYI's (IQ) second-quarter 2019 results are expected to benefit from solid content slate, expanding original content portfolio and partnerships.
BEIJING , Aug. 15, 2019 /PRNewswire/ -- iQIYI Sports, a joint venture between iQIYI, Inc. (NASDAQ:IQ) ("iQIYI" or the "Company"), an innovative market-leading online entertainment service ...
Credit has to be given where it's due -- at least the Alibaba Group (NYSE:BABA) bulls are trying. Though down in step with most other stocks since late July, Alibaba stock turned the ship around in early August before a major technical floor was broken. For the second time in less than three months, that recovery effort is unfurling on above-average volume.It remains to be seen if it will take hold. A solid second quarter report from rival JD.com (NASDAQ:JD) certainly helped fan the bullish flames of the current rebound effort. But, it wasn't enough to push BABA stock above a convergence of technical resistance before a newly-inverted yield curve stoked recession fears … again.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 15 Growth Stocks to Buy for the Long Haul Thursday's post-close earnings report from Alibaba Group may well force traders to commit to a decision, for better or worse, on Alibaba stock. BABA Stock Getting SqueezedIt's a misnomer that all of China's top stocks are in a nosedive. Certainly Weibo (NASDAQ:WB), Baidu (NASDAQ:BIDU) and Iqiyi (NASDAQ:IQ) have been fighting losing battles. Baozun (NASDAQ:BZUN), Tencent (OTCMKTS:TCEHY) and Alibaba stock remain in distinct uptrends though, even with sizeable setbacks seen in the middle of 2018.That could all change dramatically after Thursday's closing bell rings, however. That's when Alibaba is slated to reveal last quarter's results into an environment where there's little room left to roam.The chart tells the tale. The rising support line in place since early 2016 is still intact, prompting last week's rebound effort. But, a relatively young falling resistance line is also in place. That's what broke the rally effort in July, and ultimately in May as well. Click to EnlargeThose two lines are clearly on an intercept course, now less than thirty points apart. That's not a lot of room for BABA stock to do what it usually does.It's highly likely that whatever Alibaba reports on Thursday will ultimately snap the psychological underpinnings of either the support or resistance that has taken shape over the past few months. Alibaba Group Facing a HeadwindThe company's first-quarter fiscal results are going to be unveiled in a less than hospitable environment.Although the White House backed off on plans to introduce new tariffs on Chinese imports into the United States this week, older tariffs remain in place. While the U.S. economy is growing at a measurable pace, China's is starting to show serious cracks. The country's industrial output grew at a 17-year low in July. Though it hinted at a recovery in June, retail spending growth fell to 7.6% last month … the second-lowest growth pace in years. The nation's unemployment rate grew from 5.1% in June to 5.3% in July.It remains to be seen to what extent that turbulence will affect Alibaba's results. The quarter in question ended in June, so the first two months of the three-month stretch were reasonably healthy.Conversely, investors are increasingly pricing stocks based on where it seems they are going rather than where they have been. If China's e-commerce giant paints anything less than a rosy forward-picture, nervous investors may assume the worst and respond bearishly to bullish news. Looking Ahead for Alibaba StockAs of the latest look, analysts are calling for earnings of $1.46 per share of BABA stock on revenue of $15.82 billion. That's considerably more than the year-ago figures of $1.16 and $11.66 billion. The bar is set uncomfortably high.On the other hand, Alibaba only failed to top one quarterly estimate for the past three years. Again, a beat may still not be good enough against the present backdrop consisting largely of worry.Whatever's in store, just know that the chart is just as likely to lead the rhetoric as much as it's apt to be shaped by it. But, that's potentially problematic in itself.If a modest breakdown drags Alibaba stock below the aforementioned floor, that selloff will be heavily highlighted by the financial media, which will exacerbate the selling by virtue of inciting more fear. The market-wide tide will also play a role in the stock's direction from here, and clearly investors are increasingly nervous.Perhaps there's a case to be made for being on the sidelines by the time Thursday's closing bell rings, even if it means leaving money on the table. There's likely to be plenty of trade-worthy action outside of the converging wedge shape.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 15 Growth Stocks to Buy for the Long Haul * 5 More Cloud Stocks With Plenty of Potential * 5 Clean Energy ETFs to Buy for 2019 The post Earnings Could Solidify or Squelch Alibaba Stock Uptrend appeared first on InvestorPlace.
BEIJING , Aug. 14, 2019 /PRNewswire/ -- The mobile application of iQIYI -- iQIYI, Inc. (NASDAQ:IQ) ("iQIYI" or the "App"), a market-leading online entertainment service in China , has ...
When iQiyi stock (NASDAQ:IQ) went public in March 2018, Karen Chan of Jefferies called IQ "the Netflix of China." Her target was $33. The price of IQ stock today is $17.21. So what went wrong?Source: Shutterstock First, competition has intensified for IQ, 56.7% owned by Baidu (NASDAQ:BIDU). IQ recently crossed over 100 million paying subscribers. Tencent Video, a subsidiary of Tencent Holdings (OTMKTS:TCEHY), is in a two-way race for first in the "red-hot" online Chinese video market, according to the South China Morning Post.Alibaba Group Holding (NYSE:BABA) runs Youku Tudou, which holds third place. These competitors are not public, so IQ stock is the only way to play the Chinese millennials' online video craze.InvestorPlace - Stock Market News, Stock Advice & Trading TipsSecond, IQ's ad revenue, 31% of its total, will stay weak this year, according to management in their Q1 conference call. China's slowing economy is the main culprit.Third, content cost has skyrocketed. It represented 79% of revenue in Q1, up 38% year over year. That leaves no room profits to be made after all other costs. * 7 AI Stocks to Watch With Strong Long-Term Narratives The reason: iQiyi, just like Netflix (NASDAQ:NFLX) produces its own for-pay drama series and variety shows as well as buys outside content. IQ believes that having unique content drives subscription growth. IQ told CNBC in May that it intends to get bigger into making movies.IQ is really a mix between YouTube, Twitch and Netflix. Its app, which offers videos, gaming and online Twitch-like streaming, is ranked eighth in China with over 530 million monthly active users. IQ wants to take advantage of Chinese millennials' movie and gaming craze.To do this, IQ's CFO told CNBC, IQ offers free content supported by ad revenue, along with pay content, especially movies and gaming. IQ calls this model "Netflix Plus." IQ's gaming app revenue was up 143% in Q1 after it recently acquired Skymoons. Is IQ Valued Like Netlfix?NFLX has over 151 million global paid members and its market value is $135.3 billion. IQ has over 100 million subscribers and its market value is $12.5 billion. This is somewhat skewed since subscriptions account for just 51% of IQ's total sales.Therefore NFLX's value is $0.90 per subscriber. IQ should be valued at $46 billion on a like-for-like basis with NFLX (51% x 100 million x $0.90). But IQ's market value is only $12.5 billion. Why Not?IQ went public at $18 in March 2018, giving it an $11.6 billion valuation. IQ had 50.8 million subscribers at that time. IQiyi stock rocketed to $44, giving it $28.4 billion valuation. Now iQiyi is at $17.21, up from a low of $14.35. Its valuation is only $12.5 billion. What happened?In Q1 2019 iQiyi lost $270.3 million on $1 billion in revenue. Q2 earnings come out on Aug. 19. Analysts expect losses of $0.57 per ADR, or over $414 million. For 2019, losses are expected to be $1.87 per share, or $1.359 billion. This will burn 53% of IQ's $2.55 billion in cash and securities.IQiyi does not produce quarterly cash flow statements. Cash flow losses are unknown each quarter. Since content acquisition costs are almost 80% of revenue, the market assumes IQ will not be cash flow positive for at least several years.This is where the comparison with Netflix falters. NFLX made $270 million in its most recent quarter. Even though its free cash flow burn was -$584 million for the quarter, this was only 11.6% of NFLX's $5 billion in cash resources. That compares to 53% annual cash burn at iQiyi.Given IQ's hot competition, weak ad revenue, massive content costs, and huge cash flow losses, iQiyi stock is not going to be valued like NFLX any time soon. Can IQ Stock Recover?Yes, but IQ must convince the market its subscriber growth and ad revenue will become profitable like at Netflix. Otherwise IQ will have to finance losses by raising more debt or equity, and/or selling assets. None of this is good for shareholders.IQ's stock has recovered from its lows, but don't expect it to approach previous highs any time soon. Wait before buying to see how it handles these issues.As of this writing, Mark R. Hake did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Real Estate Investments to Ride Out the Current Storm * 7 Marijuana Penny Stocks to Consider for Those Who Can Handle Risk * 7 Safe Dividend Stocks for Investors to Buy Right Now The post IQiyi Stock Is a Play on China's Millennial Craze appeared first on InvestorPlace.
It's been a rough run for iQiyi (NASDAQ:IQ) as a public company on Wall Street. The Chinese streaming giant (sometimes touted as the Netflix (NASDAQ:NFLX) of China)had a brief honeymoon phase following its March 2018 IPO. IQ stock sailed from the $18 IPO price, to nearly $50 by mid-June 2018.Source: Shutterstock Then, the honeymoon ended. IQ stock dropped to $15 by late 2018 and has been volatile and choppy ever since, ultimately gaining no ground. Investors have remained concerned with regards to China's slowing digital economy and iQiyi's huge losses.Bulls are hoping second-quarter earnings due on Aug. 19 will provide an upward catalyst for iQiyi stock. I'm not convinced. iQiyi has a profit problem. This profit problem is ultimately what has weighed on the stock over the past few months. I don't see the problem getting better anytime soon. As such, I think the recent weakness in iQiyi is here to stay.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Safe Dividend Stocks for Investors to Buy Right Now At some point, IQ stock becomes a good buy given its long term growth potential in the (what should be) huge China streaming market. But, that point is not here, and it's not now.As such, for the foreseeable future, I think it's best to steer away from IQ stock. The stock remains too risky to touch until profit trends show signs of improvement. iQiyi Has A Profit ProblemIn the big picture, iQiyi is not the Netflix of China. Whereas Netflix has figured out a way to produce sizable profits at scale in the global streaming TV market, iQiyi has yet to do the same in the structurally different China streaming TV market.Indeed, China's streaming TV market is so structurally different that it may be impossible for iQiyi to net a profit here, and that means that iQiyi has a big profit problem that may not go away anytime soon.The difference between China and America's streaming markets comes down to one difference: in America, consumers are willing to pay for content; in China, they aren't. It's that simple.Netflix charges about $10 to 15 per month per subscriber. Pretty much every other U.S.-based streaming service charges the same, from Hulu to Disney+ to Amazon Prime Video. iQiyi, meanwhile, charges about $1.50 to $2 per month. That number isn't a factor of lack of scale, either. iQiyi has nearly 100 million subs, and the average revenue per sub has been stuck in neutral for several years. Instead, it's a byproduct of the fact that Chinese consumers simply aren't willing to pay much for streaming TV content.Thus, iQiyi's unit revenue potential is significantly lower than Netflix's unit revenue potential, but unit costs are pretty much the same. That is, even though streaming prices in China are low, the cost to produce content is not. The result? Unit revenues are lower. Unit costs are the same. Thus, the unit economics at iQiyi are significantly worse than the unit economics at Netflix.Netflix isn't that profitable of a company. They run at operating margins narrowly above 10%. Thus, with significantly worse unit economics, the pathway towards profitability for iQiyi lacks visibility. So long as that remains true, IQ stock will remain depressed. Long Term Potential Is There, but Not CompellingChina's massive digital population and huge consumer appetite for streaming content should mean that iQiyi stock has robust long term growth prospects. But, given the aforementioned profitability concerns, those long term growth prospects aren't compelling here and now.Qualitatively, I think that China's streaming market will grow by leaps and bounds over the next several years as China's consumer economy continues to rapidly digitize. I also think that iQiyi will leverage its original content strategy and scale to remain a very relevant player in this market, implying strong subscriber growth over the next few years. Unit revenues should march somewhat higher with scale. Revenue scale should simultaneously drive positive operating leverage, and margins should trend higher.If you reasonably math out all those aforementioned assumptions, iQiyi projects as a company that could do about $13 billion in revenue by 2025, with profits that will hover around $1 billion. Assuming a multiple of 20-times its forward earnings, which is around average for growth stocks, that equates to a 2024 valuation target for the stock of $20 billion. Discounted back by 10% per year implies a 2019 valuation target of about $12.4 billion.Leaving room for 15% error in the projections, that further equates to a 2019 fair valuation range for IQ of about $10 billion to about $14 billion. IQ stock trades in that range today. Thus, there is upside potential from here, but it's not compelling enough given the company's huge profitability risks. Bottom Line on IQ StockAhead of Q2 earnings, IQ stock remains too risky to touch. At its core, this company has a profit problem. Until that profit problem eases, the stock won't stage a meaningful turnaround. I don't see that profit problem turning around anytime soon. As such, I don't see iQiyi stock turning around any time soon, either.Even if it does, it's still probably best to wait for confirmation rather than to rely on speculation. Because of this - even if the numbers are good - the best time to buy iQiyi stock will be after the Q2 print, not before it.As of this writing, Luke Lango was long NFLX. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Real Estate Investments to Ride Out the Current Storm * 7 Marijuana Penny Stocks to Consider for Those Who Can Handle Risk * 7 Safe Dividend Stocks for Investors to Buy Right Now The post Here's Why IQ Stock Remains Way Too Risky to Touch Right Now appeared first on InvestorPlace.
Baidu is set to report second-quarter earnings on Aug. 19. Weaker online ad business and a delay in iQiyi’s launch of some broadcasting content are contributing to lower expectations.
In the latest trading session, iQIYI, Inc. Sponsored ADR (IQ) closed at $16.86, marking a -1.81% move from the previous day.
As we start August, markets face fresh uncertainty as to how the trade wars will develop, what the Federal Reserve may do next and whether the tensions with Iran will keep heating up. Today, I am going to discuss three stocks that investors may consider selling or hedging: Apple (NASDAQ:AAPL), Baidu (NASDAQ:BIDU) and Boeing (NYSE:BA).Stocks tend to behave differently in a falling market than they do in a rising one. The down moves can be rather fast in a declining market, and a momentum stock may become a falling knife. I personally do not like catching falling knives.Investors may consider waiting on the sidelines if they do not currently have any positions open in AAPL, BIDU or BA stock. If they already own shares, they may either consider taking some money off the table, or hedging their positions. If we're talking about hedging strategies, then covered calls or put spreads with Sep 20 expiry could be appropriate since straight put purchases are likely to be expensive due to heightened volatility.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Stocks to Buy on the Trade War Dip With all of that in mind, let's dive a little deeper into each of these stocks. Stocks to Sell: Apple (AAPL)Source: Shutterstock Notable Risks: Profit-taking, trade wars, currency fluctuations and broader tech market weaknessPossible Price Range: $180-$210On July 30, Apple stock reported third-quarter 2019 earnings, beating on both revenue and earnings per share. And AAPL shares initially went up.However, volatility kicked in after the Fed interest rate decision the next day. Then, on Aug. 1, President Donald Trump announced more Chinese tariffs and AAPL stock took a beating. After all, China is Apple's second-most important market. In Q3, $9.15 billion of Apple revenue came from this key region.It'd be fair to say that Apple stock has now become a proxy for the trade wars between the U.S. and China. Almost 20% of Apple's revenues come from China. In 2018 and so far in 2019, sales of iPhones in China have declined. In its Q3 statement, AAPL reported that sales in China were down 4.5% and there's a good possibility that China's economy will slow some more.Furthermore, AAPL relies on Chinese suppliers, and its mobile devices are assembled in China. Thus, Apple would have to react to tariffs either by increasing prices in the U.S. or absorbing the cost of the tariffs. The latter action would definitely have a major negative impact on the price of Apple stock.It is no wonder that whenever trade war headlines hit the wires, Apple stock price gets negatively affected. The further the signing of the trade deal gets pushed out, the greater the adverse effect on Apple's future earnings and AAPL stock could be.If AAPL's sales, margins and revenue all decline in China amid increased competition from local companies including Huawei, and currency headwinds, then the multiple of Apple stock will drop.Year-to-date, AAPL shares are up abut 30%. Not all investors are comfortable with the increased volatility levels in the stock. If you are a shareholder who has been able to ride the impressive rally since early January, then you may want to take some of your profits. Baidu (BIDU)Source: Shutterstock Notable Risks: Trade wars, questions about growth and broader tech market weaknessPossible Price Range: $90-$115Baidu is expected to report earnings on Aug. 19. During the past year, the BIDU stock price is down over 30%. Its 52-week range has been between $97.77 and $234.88. Now, Baidu stock is hovering around $100. Clearly, the bears have taken control of the tape.What is the main reason for the deterioration of Baidu's market cap? Investors fear that the group's growth narrative does not hold up any more.BIDU has two sources of revenue: * Internet advertising business (which is at the core); and * Income from majority ownership in iQiyi (NASDAQ:IQ)Baidu has over 70% of the Chinese online search market share. Until about a year ago, this leadership has meant growing advertising revenues and solid margins.However, that is not the case anymore. Competitors like Alibaba (NYSE:BABA) and Tencent (OTCMKTS:TCEHY) have been pressuring its business model and ad revenues. Many Chinese consumers are using apps that bypass browsers and thus Baidu's search engine. In other words, BIDU stock's desktop search business is being disrupted or even displaced.Wall Street is not sure if management knows how to go after the challenge to Baidu's core business. The company has increased spending to attract more advertisers, which in turn has affected margins.Furthermore, as the Chinese economy slows down, all these companies chase the same advertisers, who have been scaling down ad budgets.The second factor adversely affecting Baidu's top-line growth comes from its ownership of iQiyi, the so-called Netflix (NASDAQ:NFLX) of China. Baidu still owns roughly two-thirds of iQiyi, so IQ's results and its growth are reflected in Baidu's consolidated numbers. And iQiyi stock is not making any money at this point, either. * 10 Cyclical Stocks to Buy (or Sell) Now And when you add the uncertainty around trade wars, it may just not be fashionable to buy BIDU shares in August, yet. Overall, the bull thesis supporting BIDU stock is falling apart. It would be important to analyze the next earnings report to see if Baidu stock has a better investment proposition for long-term investors. Boeing (BA)Source: Shutterstock Notable Risks: Trade wars, questions about 737 Max 8 aircraft and broader market weaknessPossible Price Range: $300-$335As a manufacturer of commercial and defense products, Boeing is one of the most important names in many portfolios. On July 24, it released quarterly earnings of $2.92 per share, beating estimates. This quarterly EPS is lower than the earnings of $3.33 per share a year ago.BA stock has had a difficult year, to say the least. Boeing shares have been falling since early March, when Ethiopian Airlines suffered a fatal accident involving a Boeing 737 Max 8 aircraft. The March 10 crash was, unfortunately, the second deadly incident of the same model plane, one of Boeing's most popular, in less than six months.In addition to the human cost of both tragedies, many of our readers should be familiar with the difficulties that have followed BA stock after the accidents. July 3, management announced a compensation plan for the survivors of the fatal crashes.The Boeing 737 Max 8 is still grounded and the company does not know if or when the plane can be airborne again. Eventually, Boeing will have to foot the bill for the losses incurred by many airlines due to cancelled flights.The ongoing U.S.-China trade war worries have also added to the BA stock price decline. The company has become one of the proxy names for the conflict. Over the past decade, the growth of China's airline industry has created a massive export market for Boeing. In fiscal year 2018 alone, Boeing generated about $13.7 billion in revenue from world's second-largest economy.Boeing, along with its main competitor Airbus (OTCMKTS:EADSY), are the world's two largest commercial aerospace manufacturers. Therefore, long term, I would not bet against Boeing.However, short-term, things could be choppy and somewhat of a mixed bag. A couple of sour trade headlines or some Boeing 737 Max-related news in the next few weeks could drive BA stock further down toward the $300 level.At the time of writing, Tezcan Gecgil did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on the Trade War Dip * The 5 Highest-Rated Dow Stocks Right Now * 4 Cybersecurity Stocks to Buy for Long-Term Gains The post 3 Volatile Stocks to Sell in August appeared first on InvestorPlace.
If you're looking for a stock to buy that will be able to withstand the uncertainty of a U.S., China trade war, Chinese video-streaming company iQiyi (NASDAQ:IQ) is not the one. This is true despite the fact IQ stock now trades below its $18 IPO price from March 2018.Source: Shutterstock In my latest article about IQ stock at the end of June, I stated that if you have the stomach, $15 is the buy zone if you want to own its stock.Since then, IQ has dropped 17%. As I write this, it's trading around $17.17, about 13% away from the $15 buy zone. Another 20% decline in its share price and iQiyi stock will be irresistible to investors. InvestorPlace - Stock Market News, Stock Advice & Trading TipsHere's why. It's Very ShortMy InvestorPlace colleague Josh Enomoto recently reminded IP readers that 21% of iQiyi's float is held short. That's more than $1.2 billion in shorted IQ stock, a number that's even more frightening when you consider that it is a larger dollar amount than iQiyi's top-line sales from Q1 2019.Josh pointed out that many of the shorts are betting against iQiyi because its revenues are thought to have peaked a year ago in Q2 2018. The company announces its second-quarter results on Aug. 19. A better-than-expected result will crush the shorts and a weak quarter will most definitely knock IQ down to below $15. My argument against the shorts is that as long as iQiyi continues to grow its revenue from membership services by more than 60% a quarter, eventually, like Netflix (NASDAQ:NFLX), it will become profitable. * 10 Stocks to Buy on the Trade War Dip "The revenue trajectory is undeniably impressive, and few doubt the analysts' near-term outlook. What's largely being overlooked is the analyst community's expectations that revenue growth will continue to grow while relative spending growth on content slows," stated InvestorPlace feature writer James Brumley July 22. "Though still expected to be in the red, the pros are looking for losses to shrink this year and next, dramatically improving the per-share profit figures for iQiyi stock."While not every business is scalable, Netflix has proven that video streaming is one of those business models that improve with size. I don't see iQiyi being any different. Eventually, it will have enough Chinese subscribers to deliver profits to the bottom line. In the meantime, IQ stock continues to fall because investors see slowing growth in China and assume that the slowdown to 6% will hurt iQiyi. Most countries would beg for 6% GDP growth, but everything is relative, I guess. China is not growing fast enough and that's hurting IQ's story for investors. The Bottom Line on IQ StockMost of my InvestorPlace colleagues are suspicious of iQiyi stock. I won't get into specific reasons why they are, but the rationale is understandable: iQiyi doesn't make money. Any time you buy the stock of a money loser, you're hoping that other investors will focus on the massive growth in sales and give the bottom-line losses a pass. Sometimes it happens … sometimes it doesn't. In the end, I don't think you should own stocks like IQ if you're not an aggressive investor who's used to volatility and understands that scaling a business takes time and money. Profits aside, iQiyi has a nice balance of revenue streams, and even though membership services account for almost 50% of its overall revenue, its other means of generating sales ensures that it keeps growing at a reasonable place. As Brumley stated, iQiyi is doing everything it can to grow, but investors don't seem to be noticing. If it drops another 20%, I'm confident they'll start to take a closer look.At the time of this writing, Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on the Trade War Dip * The 5 Highest-Rated Dow Stocks Right Now * 4 Cybersecurity Stocks to Buy for Long-Term Gains The post Another 20% Drop and iQiyi Stock Is Finally Worth a Buy appeared first on InvestorPlace.
BEIJING, Aug. 5, 2019 /PRNewswire/ -- iQIYI, Inc. (IQ) ("iQIYI" or the "Company"), an innovative market-leading online entertainment company in China, yesterday hosted a "Scream Night" live music concert (the "Event") in Beijing. The Event was held as part of iQIYI's Summer Young events, a series of summer-themed offline events in which iQIYI members are given the opportunity to interact with celebrities that appear in their online viewing experience. The Event featured performances from a star-studded line-up, such as Jay Chou and the company's first Chinese new-gen culture virtual idol band RiCH BOOM (the "Band"), which is composed of 6 band members with different appearance and personalities.