UPDATE: Morgan Stanley Reiterates Underweight Rating, Removes PT on Changyou.Com Ltd. Following Muted 1Q14 Results

In a report published Monday, Morgan Stanley analyst Timothy Chan reiterated an Underweight rating on Changyou.Com Ltd. CYOU, but removed the $26.00 price target. In the report, Morgan Stanley noted, “We retain our UW rating after Changyou's 1Q14 results. Its 1Q14 revenues were US$181mn, down 7% QoQ and up 2% YoY, slightly higher than its guidance of US$174-180mn. Owing to a high level of marketing spending, its non-GAAP net loss was US$19mn, in-line with its guidance of loss of US$16-22mn. 1Q14 was its first quarterly loss since 2Q07. We could turn more positive upon seeing sustained margin improvements.” Changyou.Com Ltd. closed on Friday at $26.65.