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Tuesday, February 08, 2005

FT highlights Chinese Internet stocks' collapse

Here's what the FT's Lex Live column says about the China Internet stocks, and a look at how the stocks have done.

The FT says:

Judging by their past performance, the portals will soon come up with the next hot idea to drive expansion. With few rules to restrain them, they have rapidly created fast-growing, profitable businesses by offering punters a slew of innovative products - from news and ring tones to online games and auctions. All three are now listed on Nasdaq and boast market values of $500m to $1.3bn. But, as the latest episode shows, they can still be blindsided by regulatory change and bullied by semi-monopolies like China Mobile. The rewards of operating in China's unfettered market can be great, but the risks are commensurate.

Just look at the stocks' performance year-to-date; it's brutal. First, here's a chart of SOHU, JOBS and SINA:
Sohu_plus

CTRP, LONG and LTON:
Ctrp

And NTES, TOMO and JRJC:
Ntes

Quick comment: Mary Meeker's slides titled "The China Internet Presentation" (you can view them here) state: "Lots of opportunity with lots and lots of risk". She was certainly right about the risk.

Posted by David Jackson on February 8, 2005 at 11:56 AM in Sub-sector: China, ticker: CTRP, ticker: JOBS, ticker: SINA, ticker: SNDA, ticker: SOHU, ticker: TOMO | Permalink

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Comments

Maybe it's time to think about small caps, again.

Posted by: George | March 14, 2005 03:27 PM

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