In a report published Monday, Morgan Stanley analyst Philip Wan reiterated equal-weight and attractive on Sohu.com SOHU. In the 4Q13 report, total sales grew by 29% YoY, which is in line with management's guidance and 1% below Morgan Stanley forecast. Ad sales jumped to 55% from online video and real estate. Overall, total sales are expected to grow again 15-19% YoY.
In the report, Morgan Stanley noted, ": Sohu reported operating loss of US$4mn in 4Q with an op margin of -1% (down ~15ppts QoQ and down ~23ppts YoY), mainly due to heavier investments in its online gaming and online video businesses. Sohu expects 1Q non-GAAP net loss to be US$42-46mn, vs. non-GAAP net profit of US$4.6mn in 4Q13 and non-GAAP net profit of US$23.9mn in 1Q13. Notably, Sohu forecasts a non-GAAP net loss of US$16-22mn for Changyou in 1Q."
On Friday, Sohu.com closed at $71.52.
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