Tag Archives: Chinese New Year

Business, Finance, Occupation & Industry

12.1 Million Reasons for Baidu to Bounce Back

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By Rick Aristotle Munarriz, The Motley Fool

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The bears keep piling up on Baidu .

Nasdaq’s bi-monthly update shows that a record 12.1 million shares were sold short as of mid-March. To place those negative wagers in perspective, China‘s leading search engine only had 8.7 million shares sold short when 2013 began. The number of naysayers has actually more than doubled over the past year.

Is Baidu broken? Can it bounce back?

The bullish counter is that Baidu has never been cheaper. As earnings continue to grow and the share price shrinks, the fallen dot-com darling’s valuation contracts. Baidu is now trading at just 16 times this year’s projected profitability and less than 13 times next year’s target.

Just to put this in context, Russia’s Yandex is going for more than 17 times next year’s profit forecast and slower-growing Google is fetching more than 15 times next year’s projected earnings.

This wouldn’t seem like such a bargain if Baidu’s financials were in a state of decline, but clearly they’re not.

The long road back for Baidu
Chinese stocks had a rough earnings season earlier this year.

Results for the fourth quarter were generally mixed, but most of China‘s bustling Internet companies disappointed investors with their guidance for the current quarter. There’s a natural seasonal slowdown this time of year, but the sequential weakness was made worse by a late start to the Chinese New Year this time around.

Baidu’s guidance — calling for a 4% to 7% sequential dip in revenue — wasn’t welcome, but many of China‘s once shining dot-com stars checked in with outlooks calling for double-digit percentage declines.

Qihoo 360 was one of the rare exceptions. The company behind the leading Internet browser and security software suite that has become a thorn in Baidu’s side since rolling out a search engine of its own bucked the trend.

To be fair, Qihoo 360 is also growing a lot faster than most of its online peers. However, Qihoo 360 is also trading at 19 times next year’s earnings.

Waiting on good news
Baidu hit a two-year low last week, so for now those 12.1 million shorts are in the black.

What would shake them out? What would make the bears scramble for the exits?

A no-brainer catalyst would be an improving perspective, and that’s actually starting to happen. After months of seeing Wall Street pros whittle down their profit targets on Baidu, the pros are starting to turn.

It’s not much.

The same analysts that thought Baidu would earn $5.39 a share this year and $6.77 a share next year just a month ago are now perched on $5.40 a share and $6.78 a share, respectively. It’s a baby step, but it’s a step in the right direction.

The next step would be Wall Street warming up to Baidu with upgrades. The last major analyst move was a downgrade by Stifel Nicolaus last month after the company’s disappointing quarterly report.

Baidu can naturally make its own luck here. It reports first-quarter results in four weeks, …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Wall St. Magically Thinks Yum! Brands' China Woes Are History

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By 24/7 Wall St.

KFC Restaurant

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Yum! Brands Inc. (NYSE: YUM) may have saved its slide of bad news out of China with the release of its same-store sales data. On the surface it looks awful, but Wall St. works off of a relative basis, and it seems that the horrific slide may have abated from the company’s troubles in China.

A Securities and Exchange Commission filing from Monday evening said that first-quarter same-store sales declined an estimated 20% for the China Division, which includes an estimated decline of 24% at KFC and an estimated 2% at Pizza Hut Casual Dining. Yum! Brands went on to say, “Consistent with prior years, the first quarter of the China Division is two months and includes January and February results.”

That 24% sounds awful, and frankly it is. What saved the day is that the February same-store sales growth was approximately 2% for the China Division. That includes flat same-store sales at KFC and 13% growth at Pizza Hut Casual Dining. There is a caveat here around the calendar, but Wall St. is taking it to heart that maybe Yum! Brands is escaping its food quality issues in China.

As far as the caveat, Yum! Brands said, “We estimate the timing of Chinese New Year had a positive mid-teen impact on February same-store sales growth for both KFC and Pizza Hut Casual Dining, offsetting a similar negative mid-teen impact in January. For the full quarter, the Chinese New Year impact to same-store sales growth was neutral.” Yum! Brands plans to release March same-store sales for its China Division on April 10, 2013, after market hours.

Yum! Brands shares closed at $67.84 on Monday, against a 52-week range of $59.68 to $74.75, and the fast-food company’s cycle-low was just in February at the peak of the woes in China after the company admitted to misjudging the situation there. Now shares are up 5% at $71.27 as Wall St. is hoping that it also misjudged the selling pressure so far in 2013.

We have not seen any real spillover into shares of McDonald’s Corp. (NYSE: MCD) on Tuesday. It closed at $98.89 Monday and shares are down only about $0.15 after the open.

Filed under: 24/7 Wall St. Wire, Consumer Product, Corporate Governance, Food, International Markets, Retail Tagged: MCD, YUM

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

China's Renren Is No Facebook

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By Rick Munarriz, Munarriz, The Motley Fool

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There’s apparently more than a few differences between social networking in China and how it’s playing out in the rest of the world.

Shares of Renren opened 4% lower this morning — turning higher later in the day — after capping off a strong quarter with a weak near-term outlook.

Revenue rose 49% to $48.8 million during the fourth quarter for China‘s leading social networking website operator. Renren’s adjusted deficit checked in at $0.06 a share. Analysts were braced for a loss of $0.07 a share on just $46.4 million in revenue.

However, digging deeper into the performance shows how different Renren is from Facebook .

It’s not just that Facebook is profitable and Renren is not. As mobile usage grows for both companies — mobile is accounting for two-thirds of Renren’s connections these days — Facebook hasn’t had a problem monetizing the platform on the smaller devices. Renren has struggled, and instead of traditional brand advertising, the Chinese speedster is turning to gaming and social e-commerce to cash in on the mobility trend. The end result is pretty shocking. Brand advertising revenue — something that’s up sharply at Facebook — actually declined 17% at Renren over the past year.

Renren’s revenue was up sharply largely on a 117% spike in online game revenue. Gaming now accounts for more than half of Renren’s revenue, and that’s a sharp contrast to Facebook where casual games are becoming less of a factor as it beefs up its platform for marketers.

There’s a price to be paid when you’re a social networking site diversifying your revenue streams away from your high-margin roots. Cost of revenue far outpaced revenue growth itself — 84% vs. 49% — as Renren invests in its Groupon-like Nuomi social commerce platform and its 56.com video-sharing hub. Facebook abandoned its foray into daily deals before it even went public, choosing instead to be a gateway for third-party merchants now via Facebook Gifts.

The market didn’t like Renren’s outlook, forecasting $44 million to $46 million in revenue for the current quarter. That’s less than the $47.3 million that Wall Street was targeting and a 6% to 10% sequential decline from the fourth quarter’s top line showing.

Analysts simply blew it this time. Nearly every single Chinese dot-com that has already reported has warned of a sequential dip during the first quarter. It’s a seasonal thing, and the late start to the Chinese New Year is making things worse.

Market bellwether Baidu set the tone last month, when China‘s top search engine projected a 4% to 7% sequential revenue decline this quarter. Youku Tudou — China‘s leading video-sharing website, and an appropriate benchmark given Renren’s push to take the company on through 56.com — spooked investors with a forecasted sequential decline of 19% to 25% this quarter.

In other words, Renren’s expected quarter-over-quarter decline of 8% at the midpoint of its range is perfectly reasonable. The 37% to 43% year-over-year growth is more than respectable.

Investors may want …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Ford Races Forward in China

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By John Rosevear, The Motley Fool

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Ford has been spending big bucks to expand its lineup in China, and recent sales results suggest that Chinese consumers are liking what they’re seeing: The Blue Oval‘s sales through the first two months of 2013 were up 46% over year-ago totals.

That’s huge. How huge? It trounced market leader General Motors‘ 7.9% gain over the same two months – itself a good result for a period in which sales at rivals Toyota and Honda actually declined.

More to the point, it’s proof that Ford’s product strategy is playing quite well in China – and that bodes very well for the Blue Oval‘s ongoing expansion plans.

Big gains in a sluggish market
While most automakers report monthly sales results in the areas in which they do business, automakers doing business in China generally present their January and February results as a combined number. That’s because Chinese New Year, a week-long holiday celebration, sometimes falls in January (like in 2012) and sometimes in February (as it did this year) – making year-over-year monthly comparisons complicated.

But this year, despite losing a week of sales to the holiday, Ford’s Chinese operation still posted a sales gain of 7% in February that looks even better when you dig into the details.

Ford operates two separate joint ventures in China: Changan Ford Automobile, which produces familiar global Ford cars like the Focus, and a joint venture with Chinese truckmaker Jiangling Motors that produces Ford-branded commercial and government vehicles based on Ford’s Transit and E350 vans.

Of those two, Changan Ford is the more significant operation, outselling the truck venture by more than two to one. And its sales have been rising sharply lately – up 39% in February alone — as Ford brings more of its well-regarded global products to the Middle Kingdom.

Familiar Fords finding success in China
Ford introduced its current global Focus compact to China last spring, with a twist: It’s called “New Focus” and positioned as an upscale offering alongside the prior-generation (“Classic Focus“) model. It has proven to be quite popular, as the two Focuses have combined to become one of China’s best-selling nameplates.

The (New) Focus was the first of 15 new Fords destined to be launched in China by mid-decade, and its success promised good things for the models that followed. The latest of those is the Kuga SUV, a near-twin of the Escape SUV in the U.S. market. It made its Chinese debut early this year and appears to be competing well with its key local rivals, Volkswagen‘s Tiguan and Honda’sCR-V.

The market for SUVs in China has been strong in recent months, a bright spot amid sluggish growth in the overall automotive market. That strength hasn’t been lost on Ford, which is planning to expand its Chinese SUV lineup by two in the next few months: The EcoSport (a small inexpensive SUV based on the Fiesta) …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Youku Tudou Is No SINA or Baidu

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By Rick Aristotle Munarriz, The Motley Fool

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China‘s leading video website operator is growing and its losses are narrowing, but that may not be enough.

Youku Tudou opened sharply lower this morning after capping off a strong quarter with lukewarm guidance for the current period.

Things have been clicking since Youku completed its acquisition of smaller rival Tudou this summer. Revenue in the fourth quarter clocked in at a better-than-expected $102.1 million, or 30% more than what the two companies combined for a year earlier. Youku Tudou still has some more synergies to squeeze out of the deal but its quarterly deficit shrank to $0.11 a share.

Analysts were expecting red ink of roughly $0.15 a share on less than $100 million in revenue.

However, then Youku Tudou had the gall to publicly look ahead. The former dot-com darling is targeting $77 million to $83 million in revenue for this year’s freshman quarter, and that’s well off the $88 million that Wall Street was modeling.

Sequential slides are normal, and this is a seasonal thing. Youku itself saw its revenue decline 13% between the fourth quarter and the first quarter a year earlier. At the midpoint we’re looking at a heartier 22% sequential drop this year, but Youku Tudou isn’t alone. The late arrival of the Chinese New Year this year has left most of the country’s leading Internet companies warning of substantial sequential dips.

SINA‘s guidance calls for a 13% sequential downtick in revenue this quarter, and that’s given its recent moves to begin monetizing its red-hot SINA Weibo micro-blogging platform. Even the typically resilient Baidu will be falling short. China‘s top search engine is targeting a 4% to 7% sequential dip on the top line this quarter.

The problem for Youku Tudou is that the revenue drop is more pronounced, and that’s with every incentive to finally begin monetizing mobile usage this year.

There’s no denying that the merger of Youku and Tudou is a good thing. The combined sites now command roughly a third of China‘s video streaming market. Cost savings will be realized. However, streaming video isn’t an easy gig, especially in China where the more magnetic content is commercially licensed.

Youku Tudou spent 26% of last quarter’s revenue on bandwidth costs in serving up the chunky video files and another 43% on content costs. We’re talking about a model where the gross margins are already leaner than the chunky net margins that investors find in Baidu and online gaming giant NetEase.com.

Youku Tudou‘s margins will improve in time, but this will never be one of China‘s most profitable companies in terms of margins. Bandwidth costs may fall and marketers may be willing to spend more to reach viewers, but investors need to be realistic.

Youku Tudou is the star player of a growing online niche, but there’s more to worry about than just this sharp sequential slip.

A smart mobile play
The mobile revolution is still in its infancy, but with so many different companies it …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Apple supplier Foxconn places hiring freeze on its largest plant

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A man walks past a logo of a Foxconn factory in Wuhan

(Reuters) – One of Apple Inc's major suppliers, Taiwan-based Foxconn Technology Group, said on Wednesday it has placed a hiring freeze on its largest plant in Shenzhen. Foxconn spokesman Louis Woo said the company is not hiring at the facility, citing the high rate of workers returning to the plant after celebrating the Chinese New Year. Woo denied a Financial Times report that Foxconn had imposed a hiring freeze across most of its factories in China as it slows production of Apple's iPhone 5. …

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Source: FULL ARTICLE at Yahoo Business

News, Politics, Government

Foxconn Says Hiring Freeze Not Apple Related; Blame HP?

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By Eric Savitz, Forbes Staff

Apple shares are trading lower Wednesday, apparently at least partly due to reports that the China-based contract manufacturer Foxconn has halted all recruiting at least until March. A report in the Financial Times blamed the move on slowing production of the Apple iPhone 5. But Bloomberg reports that Foxconn is saying the move is not related to Apple, and instead reflects the fact that more employees returned from the Chinese New Year break than a year earlier. …read more
Source: FULL ARTICLE at Forbes Latest

Science & Technology

Chinese New Year fireworks harm health, study finds

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This Sunday, people around the world celebrated Chinese New Year with firework displays and sparklers, but new research confirms this tradition could seriously harm peoples health. An international team of scientists have shown that a firework display, even a small one at home, can spread toxic particles for miles. …read more
Source: FULL ARTICLE at Phys.org

News, Politics, Government

Oil dips slightly as Asia observes Lunar New Year

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Oil prices dipped slightly Monday, as much of Asia observed public holidays that kept many stock markets closed.

Benchmark oil for March delivery fell 7 cents at midday Bangkok time to $95.65 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 11 cents to $95.72 per barrel on the Nymex on Friday.

Trading was expected to be light for much of the week with markets shut for Chinese New Year.

The U.S. government said Friday that the country’s trade deficit fell nearly 21 percent in December from November – the smallest trade deficit in nearly three years – due largely to plunging oil imports. Production of oil is surging in the U.S., lowering the prices of U.S. crude oil.

In London, Brent crude, used to price international varieties of oil, fell 15 cents to $118.75 a barrel on the ICE Futures exchange.

In other energy futures trading on the Nymex:

— Wholesale gasoline fell 1 cent to $3.0523 a gallon.

— Natural gas fell 1.4 cents to $3.258 per 1,000 cubic feet.

— Heating oil gained 0.5 cents to $3.2437 a gallon.

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Source: FULL ARTICLE at Fox World News

Styles & Fashion

Red-Hot Prep For Valentine's Day, Chinese New Year, and Fashion Week

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By Tara Block

It was a rouge-filled week of festivities ahead of Valentine’s Day, the Chinese New Year, and New York Fashion Week. It may have been a chilly seven days, but hearts were warmed with the sight of adorable Girl Scouts, the first couple attending a prayer service, and women around the world taking part in cultural events. See what you may have missed with our roundup of the most news-worthy pictures of the week!

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Source: FULL ARTICLE at fashionologie

Styles & Fashion

In Celebration of Chinese New Year: Benefits of Cobra Pose

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By Jenny Sugar

Just thinking about snakes may make your skin crawl, but Sunday’s Lunar New Year also begins the year of the snake, making it an opportune time to practice Cobra Pose (Sanskrit: Bhujangasana). When you hop on your mat this weekend, celebrate the Chinese New Year with Cobra, and receive all of these health benefits at the same time.

Stress reduction: Heart-opening poses like Cobra take an emotional weight off the mind, elevating your mood and helping to reduce anxiety and stress.

Build upper-body strength: Having to hold the torso up during Cobra will help strengthen and tone the biceps, triceps, and deltoids. Just keep in mind that this is a relaxing pose, so to prevent working too hard, keep a slight bend in the elbows.

Reduce neck and back pain: This posture stretches the muscles in the shoulders, chest, and neck, which can help relieve tightness in the upper body and back. Cobra is especially beneficial for those who sit hunched over a desk all day.

Prevent injury: Runners, skiers, and cyclists all rely on their legs, which results in oh-so-tight hip flexors. Stretching this area with Cobra Pose can keep hips flexible, reducing the risk of injury. Cobra also allows the front of the body a chance to stretch and open up, which can reduce the risk of shoulder injury.

Stretches the abs: Just as you do hamstring stretches after a run, it’s important to stretch your belly after doing core-focused exercises; Cobra is the perfect pose to stretch your abs.

Relieves sciatica: Tight muscles in the lower back, hips, and legs can cause the pinching pain of sciatica, and doing Cobra Pose will help increase flexibility in this area.

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Source: FULL ARTICLE at fashionologie

Styles & Fashion

Gung Hay Fat Choy! 7 Ways to Ring In the Chinese New Year With Kids

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By Lisa Horten

This Sunday, Feb. 10, marks the Chinese New Year, the most important of all Chinese holidays. The 15-day celebration is based on the lunar cycle, beginning on the first day of a new moon and ending with a Lantern Festival on the full moon. Traditionally celebrated with family meals, fireworks, gifts, and general merriment, we think it’s a great opportunity to learn a bit about Chinese culture as a family. Here, seven fun ways that you can celebrate the Year of the Water Snake with your kids!

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Source: FULL ARTICLE at fashionologie

News, Politics, Government

Does China's Anti-Corruption Campaign Spell the End of the Mistress Economy?

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By Junheng Li

The private back rooms of Beijing restaurants, usually so boisterous before the Spring Festival, are strangely quiet this year. The government scaled back the elaborate banquets it typically holds in the run-up to Chinese New Year on February 10 and canceled some outright. …read more
Source: FULL ARTICLE at Forbes Opinions

News, Politics, Government

China's Anti-Corruption Campaign Pushes Luxury Undergroun

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By Junheng Li, Contributor

The private back rooms of Beijing restaurants, usually so boisterous before the Spring Festival, are strangely quiet this year. The government scaled back the elaborate banquets it typically holds in the run-up to Chinese New Year on February 10 and canceled some outright. …read more
Source: FULL ARTICLE at Forbes Latest

Styles & Fashion

Sugar Shout Out: Weigh In on All the Nicholas Sparks Movies

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By Ivana Dukanovic

Source: FULL ARTICLE at fashionologie

News, Politics, Government

26 killed when truck carrying fireworks explodes on Chinese highway

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A truck carrying fireworks ahead of Chinese New Year celebrations exploded and destroyed part of an elevated highway Friday in central China, killing at least 26 people as it sent vehicles plummeting 30 meters (about 100 feet) to the ground, state media said.

The huge blast destroyed an 80-meter (80-yard) stretch of highway outside the city of Sanmenxia in Henan province, and was powerful enough to shatter windows of a nearby truck stop.

Emergency crews closed the highway at the accident site, said China National Radio, which reported the death toll of 26. The Xinhua News Agency reported four deaths but said search and rescue efforts were continuing. At least 15 people were injured and sent to nearby hospitals, the Henan Commercial Newspaper reported.

Photos posted on the popular news site Sina.com by Chinese netizens showed a stretch of elevated highway gone, with a truck perched precariously at the broken edge. Other photos showed wrecked trucks below and blackened chunks of scattered debris, including collapsed sections of highway, wrecked trucks and cargo containers.

Source: FULL ARTICLE at Fox World News