27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
Two large Chinese video game streaming companies agreed to a merger Monday.
What Happened: Huya Inc (NYSE:HUYA) and DouYu International (NASDAQ:DOYU) announced a merger agreement Monday. The deal comes after pressure from Tencent Holdings Ltd (OTC:TCEHY) for the companies to merge.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
Huya will acquire all outstanding Douyu shares, including American depository shares. Each Douyu ADS will receive .730 Huya ADSs representing one Huya Class A share.
Joyy Inc (NASDAQ:YY), a large shareholder in Huya, provided written consent for the merger deal.
Huya will pay $200 million in cash dividends to shareholders around the closing date of the merger.
If the merger is completed, each company will hold around 50% of the combined entity. The deal is expected to close in the first half of 2021.
Why It’s Important: Tencent has pushed for a merger of the two companies for months. Tencent had stakes in both companies and will own 67.5% voting power in the new combined company.
Tencent bought stakes in Huya from Joyy and Huya CEO Doug Rongjie.
FREE REPORT: How To Learn Options Trading Fast
In this special report, you will learn the four best strategies for trading options, how to stay safe as a complete beginner, a 411% trade case study, PLUS how to access two new potential winning options trades starting today.Claim Your Free Report Here.
Tencent said it will assign its interest in Penguin e-Sports — a streaming rival to the two merging companies — to Douyu prior to the merger.
Large User Base: In the second quarter, Huya reported a 34% increase in revenue to $381.8 million. The company had 75.6 million mobile monthly active users, good for growth of 35% year-over-year.
The company had total MAUs of 168.5 million for year-over-year growth of 17.1%. Huya reported paying users of 6.2 million, year-over-yar growth of 26.5%.
Douyu reported revenue growth of 33.9% to $354.4 million in the second quarter. The company reported 58.4 million mobile MAUs and year-over-year growth of 15.4%. Total MAUs in the second quarter were 165.3 million. Paying users grew 13.4% year-over-year to 7.6 million.
Together, the two companies will have a large user base and constitute a major player in the livestreaming market, which has grown rapidly in China.
The companies compete with Bilibili (NASDAQ:BILI), which reported 172 million MAUs in the second quarter. Bilibili had 12.9 million paying users.
While Huya and Douyu compete mainly in gaming streaming, Bilibili appeals to a wider range of audience with other topics.
All three companies ultimately compete for time spent on the platform, and the merger could give Tencent’s streaming efforts a major push. Tencent is a small shareholder in Bilibili as well.
What’s Next: Together, the two streamers could have a combined audience of 300 million MAUs depending on how much overlap there is between the platforms' users.
HUYA, DOYU Price Action: Huya shares were down 9.25% at $23.40 at last check Monday, while Douyu shares were trading 13.54% higher at $15.90.
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.