Phoenix New Media (6/6 closing price = $3.45) is selling a majority of its strategic investment in Yidian Zixun for estimated net cash proceeds of US$409mm ($5.62/ADS). The company expects to pay a special dividend of 15-25% of proceeds ($0.84-$1.40/ADS) The company will retain net cash + ST/LT investments after the dividend of $552-$593mm ($7.56-8.12/ADS) … Continue reading Phoenix New Media: Special Dividend, Strong Asset Value, Strong Brand, Weak Profitability
Sohu's 20-F revealed that the company no longer believes it will owe any special one-time tax in connection with the 2017 US Tax Reform. If correct then this will free up $144mm of cash (about $3.69/ADS) for general corporate purposes. Investors in Changyou and Sohu are frustrated by the lack of information about the status … Continue reading Sohu 20-F Reveals $144mm Tax Benefit
Changyou's recently distributed special dividend and Sohu's pending liquidation may be intended to facilitate a new buyout offer for Changyou. Fair value for a transaction should be at least $29.74/ADS. Some additional background was in my prior articles: Changyou’s Buyout Price Should be Raised to at least $53 Sohu Valuation enhanced by successful Sogou IPO and … Continue reading What’s next after the Changyou dividend and Sohu liquidation?
Successful IPO of the Sogou search business clarifies the $1.5Bn value of Sohu's retained 33% stake ($39/share of SOHU) Possible privatization of the Changyou gaming business would deliver $1.4Bn of net cash before tax ($35/share of SOHU) at the unfair preliminary offer price or $1.8-3.2Bn ($45-$82/Share of SOHU) at fair value Sohu has minimal debt, … Continue reading Sohu Valuation enhanced by successful Sogou IPO and potential Changyou privatization
2/1/18 Update: Liquid Assets (cash+investments+loan) at 12/31/17 were $1127mm or $21.06/ADS. Chairman Charles Zhang offered to acquire all outstanding shares of Changyou at a price of $42.10/ADS The offered price is significantly below the average valuations of competing companies (27.7 P/E for US/HK listed and 36.9 P/E for China listed) The offered price does not … Continue reading Changyou’s Buyout Price Should be Raised to at least $53
Bloomberg reports China’s Sogou Targets $5 Billion IPO to Chase Rival Baidu. Here's a quick look at what an IPO at this valuation would mean for Sohu which currently owns 38% of Sogou. SOHU has three main businesses: Media Portal, including sohu.com focus.cn and 17173.com. These businesses reported an operating loss of $136mm in 9M16. Advertising … Continue reading Thoughts on the impact on Sohu of a possible Sogou IPO