The company reported a 43% year-over-year revenue increase thanks to Weibo, its messaging service, increasing its advertising sales by 163% to $56 million. But Sina's non-GAAP revenue of $192.3 million barely edged the consensus estimate of $192.2 million, according to Thomson Reuters. Non-GAAP net income also doubled to $33 million or 47 cents a share, which also barely beat analysts' expectations of 46 cents.
Reports also surfaced Monday that Sina plans an IPO for Weibo, but this plan could fall flat, as Sina's fourth-quarter report showed Weibo relies heavily on advertising for its revenue.
"The strong performance of Weibo's advertising and value-added services in the fourth quarter allowed us to end 2013 with strong top line and bottom line growth," said Chairman and CEO Charles Chao in the company's statement. "As we enter 2014, we will continue to focus on growing Weibo's user base and user engagement through product innovation, as well as seizing opportunities to enable us for long-term growth."
TheStreet Ratings team rates SINA CORP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate SINA CORP (SINA) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."