Updated from 10:25 a.m. with closing price information.
NEW YORK (TheStreet) -- Shares of ChinaNet Online (CNET) - Get ChinaNet Online Holdings, Inc. Report soared to a 52-week high of $3.98 in morning trading Monday after the business-to-business Internet technology company announced it had won the award for "Best Company in Chinese Entrepreneurial SME Business Development Marketing" at the 2014 Chinese e-Commerce Industry Gateway Conference in Beijing.
The award goes to only one enterprise in each industry, according to ChinaNet.
The China Electronic Commerce Association (CECA) organized the conference.
ChinaNet's stock surged Friday after the company announced it was in talks to partner with Alibaba's (BABA) - Get Alibaba Group Holding Ltd. Sponsored ADR Report online shopping unit Taobao.
"We are very excited about our new focus on digital advertising and our cooperation with Baidu," ChinaNet said. "We are also in discussions with Taobao of Alibaba to provide 'Micro-Sell 360,' which is one of our new product solutions geared towards precision marketing for clients."
The stock closed up 61.84% to $3.17. More than 37.3 million shares had changed hands, which eclipsed the average volume of 512,536.
Separately, TheStreet Ratings team rates CHINANET ONLINE HOLDINGS as a "sell" with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHINANET ONLINE HOLDINGS (CNET) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CHINANET ONLINE HOLDINGS has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINANET ONLINE HOLDINGS swung to a loss, reporting -$0.01 versus $0.13 in the prior year.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Media industry. The net income has significantly decreased by 406.7% when compared to the same quarter one year ago, falling from $0.43 million to -$1.33 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Media industry and the overall market, CHINANET ONLINE HOLDINGS's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for CHINANET ONLINE HOLDINGS is rather low; currently it is at 16.37%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -12.84% is significantly below that of the industry average.
- Net operating cash flow has declined marginally to $0.41 million or 0.97% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, CHINANET ONLINE HOLDINGS has marginally lower results.
- You can view the full analysis from the report here: CNET Ratings Report