Cheetah Mobile Advances as Sales Beat Estimates: China Overnight

Aug 19, 2014 10:32 pm ET

Aug. 20 (Bloomberg) --Cheetah Mobile Inc. rose in U.S. trading as the Chinese maker of security software forecast an increase in revenue after second-quarter sales exceeded analysts’ estimates.

The company’s American depositary receipts added 1.3 percent as of 2:21 p.m. in New York after gaining as much as 13 percent. Solar manufacturers from Yingli Green Energy Holding Co. to Trina Solar Ltd. rallied on speculation a supply glut that has weighed on prices is easing. The Bloomberg China-US Equity Index fell 0.1 percent to 117.00.

Cheetah rose as trading volume surged to 2.8 times the full-day average of the past three months after the company said it expects third-quarter revenue to be between 430 million yuan ($70 million) and 440 million yuan. The forecast came after Cheetah posted sales of $61.3 million in the three months ended June 30, exceeding the $55.6 million average estimate of analysts surveyed by Bloomberg.

“Cheetah’s strong second-quarter results and third-quarter guidance beat analysts’ consensus by a big margin thanks to its fast mobile-business growth in China,” Henry Guo, a San Francisco-based analyst at JG Capital, said by phone. “The stock should continue to rise if its business monetization from overseas markets can gain traction.”

Cheetah, whose revenue from mobile-security applications has risen to 20 percent of total sales, has attracted international investors including Singapore’s state-owned Temasek Holdings Pte. The ADRs increased to $27.26 and earlier reached the highest since the Beijing-based company’s May 8 debut.

Yingli, Trina

Yingli, the world’s biggest solar panel maker, advanced 5.4 percent to $3.76, set for the highest since June 27. Trina climbed 5.1 percent to $13.09, an almost three-month high on a closing basis.

Manufacturers including SunPower Corp. in the U.S. and Germany’s Manz AG are expecting a looming shortage of solar panels to spur orders after a global glut that began in 2011. Average spot prices for modules, which have been tumbling since October, slid this week to the lowest since at least January 2010, data compiled by Bloomberg show.

The iShares China Large-Cap ETF, the biggest Chinese exchange-traded fund in the U.S., declined 0.1 percent to $41.34. The Standard & Poor’s 500 Index gained 0.5 percent as retailers rallied on better-than-projected earnings while data showed inflation pressures remain limited and housing starts jumped.

The Hang Seng China Enterprises Index gained 0.3 percent to 11,094.59, while the Shanghai Composite Index rose 0.3 percent to an eight-month high of 2,245.33.