The Zhitong Finance App learned that UBS released a research report stating that it reaffirmed the Weibo-SW (09898) “buy” rating. After the first quarter results were announced, the revenue forecast for the full year of this year remained unchanged, but the adjusted net profit forecast was raised by about 2%, and the target price was HK$90. The company's revenue for the first quarter fell 4.4% year on year, and the decline was narrower than forecast. Due to ideal sales and marketing savings, adjusted net profit exceeded the bank and market expectations by more than 20%.

The bank pointed out that in terms of fixed exchange rates, Weibo's advertising revenue in the first quarter was flat year on year. Management believed that the advertising market would bottom out from the second quarter, while consumption performance in March and April seemed to be weak, but noted strong demand at the 618 shopping festival. Furthermore, it is predicted that Weibo's total revenue for the second quarter will remain the same year on year. Considering that the Olympics will be held this summer, it is expected to drive advertising revenue growth in the second half of the year compared to the first half of the year. It is estimated that revenue for the third and fourth quarter will increase by 5% and 7%, respectively.

According to the report, Weibo still promises to maintain an annual dividend of about 200 million US dollars, with a dividend rate of about 9% based on current market capitalization. Weibo's current price is about 5 times the price-earnings ratio predicted this year, which is the lowest among many mainland Internet stocks. It is believed that the stock price already reflects lower growth in the advertising business than its peers, and that there is limited room for the stock's potential decline. It is believed that the potential recovery in the second half of the year will be its catalytic factor, and the Group's commitment to shareholder returns will also provide a buffer for further decline.