NEW YORK (TheStreet) -- Shares of Chinese subscription video service YOU on Demand (YOD) soared 33.06% to $3.26 in morning trading Wednesday after Chinese smartphone maker Xiaomi said it would invest $1 billion to acquire television content.
The world's fourth-largest smartphone maker, which began making smart TVs last year, joins other Chinese software titans trying to control video content in the nation. The company said it would expand its Web video content library on its televisions and set-tops.
The announcement provided a significant boost to YOU on Demand, which announced in April its You Cinema movie subscription service would become available on Xiaomi set-tops.
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More than 7.9 million shares had changed hands as of 10:45 a.m., compared to the average volume of 276,312.
Separately, TheStreet Ratings team rates YOU ON DEMAND HOLDINGS INC as a "sell" with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate YOU ON DEMAND HOLDINGS INC (YOD) a SELL. This is driven by a few notable 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. Among the areas we feel are negative, one of the most important has been weak operating cash flow."