UPDATE: Maxim Group Upgrades SINA to Hold as Weibo Revenue Ramps Up

In a report published Friday, Maxim Group analyst Echo He upgraded SINA SINA from Sell to Hold, but removed the $48.00 price target.

In the report, Maxim Group noted, “We are upgrading SINA to Hold, from Sell, and removing our 12-month price target of $48. We expect margins to improve in 2013-2015 mainly driven by Weibo revenue ramp up, which is partially secured by collaboration with Alibaba. Meanwhile, portal revenue may also stop declining. Weibo's improving operating leverage drives overall margin improvement. In 1Q13, non-GAAP operating margin improved to (7.6%) from (18.6%) a year ago, reversing the consecutive decline in the past two years, as a result of heavy investments in Weibo plus economic slowdown. We expect continued margin improvement to 2.4%, 10.2% and 14.8% in 2013-2015, respectively, from (1.5%) in 2012, although still below historical high of ~25% in 2007. We estimate Weibo is still operating at a loss. We expect Weibo to generate profit in 2H14 and reach an operating margin comparable to SINA's portal in 2015.”

SINA closed on Thursday at $56.58.