What is WB?
Weibo enables its advertising and marketing customers to promote their brands, products and services to users. Weibo offers a wide range of advertising and marketing solutions to companies of all sizes. The Company generates a substantial majority of its revenues from the sale of advertising and marketing services, including the sale of social display advertising and promoted marketing offerings.
Is WB a good pick?
Net revenues increased 30% over the previous year to US$607.4 million, an increase of 23% over the previous year in constant currency. Advertising and marketing revenues increased 29% over the previous year to US$537.6 million. Value-added services revenues increased 42% over the prior year to US$69.8 million. Income from operations was $213.0 million, an increase of 32% over the prior year, representing an operating margin of 35%. Net income attributable to Weibo was $181.7 million and diluted net income per share was $0.78. Revenue from non-GAAP operations increased 39% year-over-year to $248.7 million, representing a non-GAAP operating margin of 41%.
Technical analysis
From August 4, 2021 to August 18, 2021 WB's share price decreased in value by 23% along with the international stock market due to the spread of the covid Delta variant. Then from August 19, 2021 to August 26, 2021 it recovered 23% due to WB filing a positive second quarter report. On August 27 a fan site dedicated to one of China's most popular and richest actresses was deleted and thousands of fan accounts dropped 15% in value, but recovered on September 9, 2021. From September 10, 2021 to October 05, 2021, after Evergrande, one of China's largest real estate developers, also a member of the Global 500, announced a crisis affecting the international stock market, Weibo suffered a -19% decline. Then, from October 6, 2021 to October 22, 2021, the share price recovered 16% to $52.05 after the United States and China agreed to hold a virtual summit. From October 23, 2021 to November 5, 2021, Weibo plunged -17% due to rising covid cases and falling Asian stocks. From November 6, 2021 to November 11, 2021, the share price rose 14% due to the strong economic data announced first. From November 12, 2021 to December 17, 2021, the share price fell by -44% due firstly to a new covid variant called Omicron and shortly thereafter to the appearance of the first case of Omicron covid in the United States, leading to inflation which also influenced the decline. From December 18, 2021 to the present, it has recovered 11% to $30.21 per share.
According to current technical indicators, the share price could increase by 12% or 15% touching 0.236 fibonacci’s resistance reaching the price of US$34.60 per share.
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