Analysts rate Weibo Corporation (WB:NSD) with a Buy, $42 Target

STA Research
by: STA Research
Weibo Corporation stock

Analysts rate Weibo Corporation stock with a consensus Buy rating and a 12-month average target price of $41.98 per share.

Goldman Sachs maintained Weibo Corporation with a Neutral rating, and  lowered the target price to $37.50 from $44.50.

Based on the Weibo Corporation stock forecasts from 7 analysts, the average analyst target price for Weibo Corporation is USD 41.98 over the next 12 months. Weibo Corporation’s average analyst rating is Buy. Stock Target Advisor’s own stock analysis of Weibo Corporation is Slightly Bullish, which is based on 8 positive signals and 4 negative signals. At the last closing, Weibo Corporation’s stock price was USD 24.90. Weibo Corporation’s stock price has changed by -0.72% over the past week, +0.44% over the past month and -49.57% over the last year.

Weibo Corporation, through its subsidiaries, operates as a social media platform for people to create, distribute, and discover content in the People’s Republic of China. It operates in two segments, Advertising and Marketing Services; and Value-Added Services. The company was formerly known as T.CN Corporation and changed its name to Weibo Corporation in 2012. The company was founded in 2009 and is headquartered in Beijing, China. Weibo Corporation is a subsidiary of Sina Corporation.

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Underpriced compared to earnings

Weibo Corporation stock is trading low compared to its peers on a price to earning basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

Superior return on equity

The company management has delivered a better return on equity in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior capital utilization

The company management has delivered a better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior return on assets

The company management has delivered a better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Earnings Growth

Compared to its sector, Weibo Corporation stock has shown top quartile earnings growth in the previous 5 years.

What we don’t like:

Poor risk-adjusted returns

This company is delivering below median risk-adjusted returns to its peers. Even if it is outperforming on returns, the returns are unpredictable. Proceed with caution.

Below median dividend returns

The company’s average income yield over the past 5 years has been low compared to its peers. However, it is not a problem if you are not looking for income.

Overpriced on a cash flow basis

Weibo Corporation stock is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.

Highly leveraged

Compared to its sector peers on debt to equity, the company is in the bottom half and is highly leveraged. However, do check the news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

 

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