SINA - Head and Shoulders pattern in formationSina Corp.'s Q4 results surpassed expectations. Net revenues of SINA increased 25% YOY and 10% QOQ to $70.7M, exceeding the company's previous guidance between $68M-$70M. This growth was primarily driven by the 40% YOY and 9% QOQ growth in advertising revenues. Non-advertising revenues reported a 1% YOY growth and a 11% QOQ growth to $20.6M. A highlight of the quarter was the stabilisation in the mobile value-added service business which witnessed a 12% QOQ revenue growth to $18.6M (this is the first time in the past two years that the company is witnessing a QOQ growth). This revenue is however a 3% decline from the same period in 2006. Gross margin, at 62%, remained flat over the comparable period last year and the previous quarter. Due to the increased marketing expenses related to corporate branding and MVAS business, Non-GAAP operating expenses were $25.8M, an increase of 15% YOY and 12% QOQ. Net Income witnessed a 49% YOY increase and a 2% sequential increase to $17.5M.
However, the stock dropped 4.5% following the announcement of Q4 results. This drop was in line with our expectations. The stock is now trading within a wedge pattern. The daily RSI and the weekly RSI plot in the neutral zone. It appears as if SINA is forming a head and shoulders pattern. For price anticipation, outlook etc. check the free research report on SINA available at www.stocks2pick.com