Momentum Stock Watch: Cheetah Mobile Inc. (CMCM)

Company Profile:

Cheetah Mobile Inc. operates as a mobile Internet company worldwide. The company’s utility products include Clean Master, a junk file cleaning, memory boosting, and privacy protection tool for mobile devices; Security Master, an anti-virus and security application for mobile devices; Battery Doctor, a power optimization tool for mobile devices; Cheetah Browser, a Web browser for PCs and mobile devices; CM Browser, a mobile browser to protect users from malicious threats; and CM Launcher, which provides personalized experience in using smart phones. The company was formerly known as Kingsoft Internet Software Holdings Limited and changed its name to Cheetah Mobile Inc. in March 2014. Cheetah Mobile Inc. was incorporated in 2009 and is headquartered in Beijing, the People’s Republic of China.

Recent News:

The company reported total revenues were RMB970.1 million (US$141.3 million) in the second quarter of 2019. The average number of global mobile monthly active users was 376.5 million. Mr. Sheng Fu, Cheetah Mobile’s Chairman and Chief Executive Officer, stated, “Our second quarter revenues exceeded the high end of our revenue guidance for the quarter.”

The Company’s board of directors approved a special cash dividend of US$0.50 per American Depositary Share (“ADS”), or US$0.05 per ordinary share. The cash dividend will be paid on September 30, 2019 to shareholders of record at the close of business on September 13, 2019.

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

CMCM’s strengths can be seen in its better growth and strong efficiency compared with its peers. Its revenue has increased over recently several years. Technical indicators signal the bullish signs, as there is a bullish crossover in MACD and Stochastic oscillator and the RSI stands at 53.52 with positive bias. We rate Cheetah Mobile Inc. (CMCM) a STRONG BUY.