China-based new media company Phoenix New Media Limited (NYSE:FENG) was on the radars of investors yesterday despite there being no news about the company. The stock enjoyed some positive action yesterday and ended up with gains of as much as 10% as a consequence.
Trading Data
On Wednesday, FENG stock gained 10% to $3.08 with more than 29K shares, compared to its average volume of 30K shares. The stock moved within a range of $2.7500 – 3.1000 after opening trade at $2.75.
Earnings Review
In light of the fact that there was no news, it may appear a bit speculative but one may take a look at the company’s financial results for the quarter that ended on March 31, 2022, which was announced on May 10. The company managed to generate revenues of RMB175.4 million and that reflected a year-on-year decline of as much as 22.4% from the revenue of RMB226.1 million in Q1 2021.
The decline in revenue was primarily a function of the drop in advertising revenues from last year. In the prior-year period, advertising revenues had been RMB201.3 million and in the latest reported quarter, it came in at RMB158.4 million. Advertisers from some industries scaled back their spending and that had an adverse effect on the company’s bottom line. Gross profit stood at RMB33.1 million and that reflected a massive drop of as much as 71.9% year on year.
Key Quote
Mr. Shuang Liu, CEO of Phoenix New Media, commented, “During the first quarter of 2022, we faced an evolving macroeconomic landscape and challenges posed by the resurgence of Covid. Confronting these pressures, we remained steadfastly committed to providing premium content, optimizing the usability of our app, and enhancing our live streaming capabilities. In addition, we fortified our leading position in news reporting and continued to diversify our revenue streams. Going forward, we will continue to explore new business initiatives and prudently manage our operations while adapting to the changing market dynamics.”
Technical Data
FENG stock is trading below the 20-Day and 50-Day Moving averages of $2.99 and $3.23 respectively. Moreover, the stock is trading below the 200-Day moving average of $5.58.
