NEW YORK (TheStreet) -- Shares of Qihoo 360 Technology (QIHU) were gaining 3% to $55.22 Thursday after the Chinese Internet security software company announced a new partnership with Chinese real estate developer Huayuan Group.
Under the new partnership, Qihoo 360 will design and provide home security systems and smart home management systems for Huayuan real estate developments. Those systems include intelligent surveillance cameras, security routers, location- and health-tracking wearables, electrical appliance safety alarms, intelligent gas, and fire alarms, among others.
"Through this partnership with Huayuan, Qihoo 360 is not only able to offer useful tools, but a sense of security, which paired with our software can connect every user, every family and office together," Qihoo 360 CEO Hongyi Zhou said in a statement. "This partnership is just the beginning for Qihoo 360 in the smart home technologies and IoT market."
TheStreet Ratings team rates QIHOO 360 TECHNOLGY CO -ADR as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate QIHOO 360 TECHNOLGY CO -ADR (QIHU) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- QIHU's very impressive revenue growth greatly exceeded the industry average of 5.8%. Since the same quarter one year prior, revenues leaped by 94.6%. 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 $1.71 versus $0.76 in the prior year. This year, the market expects an improvement in earnings ($3.48 versus $1.71).
- 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 361.4% when compared to the same quarter one year prior, rising from $16.65 million to $76.82 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. 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.
- The gross profit margin for QIHOO 360 TECHNOLGY CO -ADR is currently very high, coming in at 81.90%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 17.81% trails the industry average.
- You can view the full analysis from the report here: QIHU Ratings Report