NEW YORK (TheStreet) -- Shares of Chinese online media company Sina Corp. (SINA) fell 6.82% to $34.95 in late morning trading Monday after it met with the Cyberspace Administration of China (CAC), according to Financial Times.
The Times reported Sunday that executives from Sina were summoned to a meeting with the CAC, which scolded the company for spreading "illegal information" and "violating morality," according to a statement from the CAC.
The administration accused Sina of not properly censoring user accounts, "engaging in media hype," and allowing the spread of "rumors", pornography, and "messages advocating heresies." The "heresies" in question refer to banned religious movements such as Falun Gong.
Law firm Pomerantz LLP is also investigating if Sina and some of its officers or directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
Separately, 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 compelling growth in net income, revenue growth and reasonable valuation levels. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year."