Pre-Market Laggard: Qihoo 360 Technology (QIHU)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Qihoo 360 Technology ( QIHU) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Qihoo 360 Technology as such a stock due to the following factors:

  • QIHU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $297.4 million.
  • QIHU traded 28,143 shares today in the pre-market hours as of 8:19 AM.
  • QIHU is down 2.5% today from yesterday's close.

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More details on QIHU:

Qihoo 360 Technology Co. Ltd. provides Internet and mobile security products and services in the People's Republic of China. QIHU has a PE ratio of 90.1. Currently there are 9 analysts that rate Qihoo 360 Technology a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Qihoo 360 Technology has been 2.7 million shares per day over the past 30 days. Qihoo 360 Technology has a market cap of $12.6 billion and is part of the technology sector and computer software & services industry. Shares are up 20.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Qihoo 360 Technology as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from the ratings report include:
  • QIHU's very impressive revenue growth greatly exceeded the industry average of 11.5%. Since the same quarter one year prior, revenues leaped by 141.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • QIHOO 360 TECHNOLGY CO -ADR reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, QIHOO 360 TECHNOLGY CO -ADR increased its bottom line by earning $0.76 versus $0.40 in the prior year. This year, the market expects an improvement in earnings ($2.50 versus $0.76).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 784.9% when compared to the same quarter one year prior, rising from $5.55 million to $49.12 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, QIHOO 360 TECHNOLGY CO -ADR's return on equity exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 459.59% to $100.46 million when compared to the same quarter last year. In addition, QIHOO 360 TECHNOLGY CO -ADR has also vastly surpassed the industry average cash flow growth rate of 17.73%.

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