Weibo (WB) AI Stock Analysis

• Market Cap: $2.84B
• Dividend Yield: 7%
• Average Volume (3M): 1.20M
• Price to Earnings (P/E): 8.3
• Beta (1Y): 0.43
• Revenue Growth: 1.49%
• EPS Growth: 14.94%
• Country: US
• Employees: 4,982
• Sector: Communication Services
• Sector Strength: 96
• Industry: Internet Content & Information
• EPS (TTM): 0.54
• Shares Outstanding: 156,449,480
• 10 Day Avg. Volume: 989,872
• 30 Day Avg. Volume: 1,195,212
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.83
• Enterprise Value/Revenue: 1.35
• Enterprise Value/Gross Profit: 1.71
• Enterprise Value/Ebitda: 4.51
• 1Y Price Target: $12.45
• Price Target Upside: 6.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 71 Outperform
• Price Target: $13.00 ▲(11.02% Upside)

Weibo's overall stock score is driven by strong technical indicators and a favorable valuation, suggesting potential for growth. Financial performance is solid, though cash flow issues warrant attention. The earnings call provided a balanced view with both growth opportunities and sector-specific challenges.

Positive Factors

Financial Performance

Weibo reported a better-than-expected 2Q25 with revenues increasing by 1.6% year over year to US$444.8 million.

User Growth

Weibo's AI integration in recommendation and search has shown significant user growth, with monthly active users increasing by 60%.

Valuation

Weibo currently trades at 6x FY25E non-GAAP PE, which offers ample safety margin versus peers’ average (19x).

Negative Factors

Advertising Trends

Ad revenue growth is expected to slow down due to softer spending in specific verticals like phone and online games, and a high base from the Olympics.

Competitive Pressure

Weibo's reliance on brand ads and a less advanced ad tech stack limits its growth potential.

Market Position

Analyst views the company as an industry tracker at best and likely to continue losing share.

Weibo Business Overview & Revenue Model

Company Description

Weibo Corporation, through its subsidiaries, operates as a social media platform for people to create, distribute, and discover content in the People's Republic of China. It operates in two segments, Advertising and Marketing Services; and Value-Added Services. The company offers discovery products to help users discover content on its platform; self-expression products that enable its users to express themselves on its platform; and social products to promote social interaction between users on its platform. It also provides advertising and marketing solutions, such as social display advertisements; and promoted marketing offerings, such as Fans Headline and Weibo Express, as well as promoted trends and search products that appear alongside user's trends discovery and search behaviors. In addition, the company offers products, such as trends, search, video/live streaming, and editing tools; content customization, copyright contents pooling, and user interaction development; and search list recommendation, trends list recommendation, and Weibo app opening advertisements. Further, it provides back-end management, traffic support, and product solutions to MCNs, unions, and e-commerce partners; open application platform for other app developers that allows users to log into third-party applications with their Weibo account for sharing third-party content on its platform; and Weibo Wallet, a product that enables platform partners to conduct interest generation activities on Weibo, such as handing out red envelops and coupons. The company was formerly known as T.CN Corporation and changed its name to Weibo Corporation in 2012. The company was founded in 2009 and is headquartered in Beijing, China. Weibo Corporation is a subsidiary of Sina Corporation.

How the Company Makes Money

Weibo generates revenue primarily through advertising services, which account for a significant portion of its earnings. The company offers various advertising products, including display ads, promoted posts, and brand partnership solutions, allowing businesses to reach targeted audiences. Additionally, Weibo monetizes its platform through value-added services, which include features like VIP memberships and the sale of virtual goods. Partnerships with other companies, such as collaborations with entertainment and media firms for promotional activities, enhance its revenue streams. The company also benefits from its large user base, which attracts advertisers looking for exposure in a densely populated digital marketplace.

Weibo Financial Statement Overview

Summary

Weibo demonstrates strong profitability and efficient cost management, with healthy margins and a stable balance sheet. However, recent cash flow issues present potential risks that need monitoring.

Income Statement

Weibo's income statement reveals stable revenue with a slight decline in 2024 compared to 2023, yet gross profit margins remain strong at approximately 79%, indicating effective cost management. The net profit margin improved to 17.1% in 2024 from 19.4% in 2023, showcasing effective cost control and operational efficiency despite lower net income. The EBIT and EBITDA margins are healthy, suggesting robust operating performance.

Balance Sheet

Weibo maintains a solid balance sheet with a manageable debt-to-equity ratio of 0.53 in 2024, showing prudent financial leverage. The equity ratio is strong at 53.5%, indicating financial stability. The return on equity is at a moderate level of 8.6%, reflecting the company's ability to generate returns from its equity base.

Cash Flow

The cash flow statement for Weibo illustrates challenges, with zero reported operating and free cash flow in 2024, potentially impacting liquidity. In previous years, free cash flow was positive, indicating that recent cash flow issues might be temporary. The operating cash flow to net income ratio was favorable in prior years, reflecting efficient cash generation historically.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.76B	1.75B	1.76B	1.84B	2.26B	1.69B
Gross Profit	1.38B	1.39B	1.39B	1.44B	1.85B	1.39B
EBITDA	524.45M	619.03M	714.45M	289.91M	668.74M	458.99M
Net Income	358.33M	300.80M	342.60M	85.56M	428.32M	313.36M
Balance Sheet
Total Assets	6.66B	6.50B	7.28B	7.13B	7.52B	6.34B
Cash, Cash Equivalents and Short-Term Investments	2.08B	2.35B	3.23B	3.17B	3.13B	3.50B
Total Debt	1.86B	1.91B	2.71B	2.42B	2.43B	2.43B
Total Liabilities	3.15B	2.93B	3.76B	3.74B	3.83B	3.45B
Stockholders Equity	3.43B	3.48B	3.40B	3.33B	3.59B	2.81B
Cash Flow
Free Cash Flow	0.00	578.43M	636.05M	367.40M	646.39M	706.82M
Operating Cash Flow	0.00	639.90M	672.82M	564.10M	814.02M	741.65M
Investing Cash Flow	0.00	-246.90M	-736.85M	-33.01M	-423.96M	-1.21B
Financing Cash Flow	0.00	-1.03B	21.69M	-91.14M	189.44M	741.96M

Weibo Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.71
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WB, the sentiment is Positive. The current price of 11.71 is above the 20-day moving average (MA) of 11.15, above the 50-day MA of 10.39, and above the 200-day MA of 9.23, indicating a bullish trend. The MACD of 0.38 indicates Negative momentum. The RSI at 62.23 is Neutral, neither overbought nor oversold. The STOCH value of 84.93 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WB.

Weibo Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TME	79 Outperform	$39.05B	26.51	14.07%	0.73%	10.66%	84.89%
PINS	79 Outperform	$25.80B	13.56	48.08%	―	17.00%	901.05%
BIDU	75 Outperform	$34.22B	9.36	10.33%	―	-1.32%	42.56%
RDDT	73 Outperform	$44.92B	202.58	10.11%	―	69.97%	―
WB	71 Outperform	$2.84B	8.29	10.77%	7.00%	1.49%	14.94%
Sector *	60 Neutral	$46.60B	4.09	-11.41%	4.12%	1.85%	-42.71%
SNAP	59 Neutral	$12.35B	―	-26.42%	―	13.18%	54.39%