Stifel Cuts Sina: 'No Longer A Growth Story'

Sina Corp SINA shares fell sharply Friday after the company posted a lower-than expected revenue outlook and analysts trimmed estimates.

Sina traded recently at $39.13, down more than 6.5 percent.

Stifel's George Askew cut his rating on the Chinese Web portal operator to Hold, from Buy, and said the company is no longer a "growth story."

Askew dismissed Sina's fourth-quarter earnings beat, calling it "unimportant," adding that few investors in the Internet sector are interested in "value" stocks versus revenue growth.

Sina Chief Executive Charles Guowei Chao told investors on a conference call that the company's portal business is "facing challenges" as advertisers have shifted to video, specialized sites and mobile.

Automobile advertising revenue, the company's largest category, fell 18 percent in the recent period while the category for so-called "fast-moving goods" fell 20 percent.

The company is revamping its business strategy by forming separate units for content areas including finance, sports, entertainment, and automobiles.

"While investors have high expectations, I would caution you that the strategy will take time," Chao said.

Advertising revenue is unlikely to grow "in the near future" and the company will see "higher than usual fluctuations" in quarterly results, Chao warned.

Brean Capital's Fawne Jiang cut her Sina price target Friday more than 13 percent to $58, from $67 a shae, but maintained a Buy rating Friday.

Sina forecast fourth-quarter revenue Thurday between $204 million and $210 million, vs. analysts' expectations of $214.75 million. That implies about a 4.5 percent growth rate from the year-earlier revenue of $197 million.