Why Weibo Corporation (NASDAQ:WB) Stock Tumbles During Pre-Market Session?

Shares of Weibo Corporation (NASDAQ:WB) tumbled -3.79% in pre-market trade Wednesday, soon after a leading social media in China, recently declared its unaudited financial results for the second quarter ended June 30, 2017.

Second Quarter 2017 Highlights:

• Net revenues totaled $253.4 million, a boost of 72% year-over-year, surpassing the Company’s guidance between $240 million and $250 million.
• Advertising and marketing revenues were $218.3 million, a boost of 72% year-over-year.
• Other revenues were $35.0 million, a boost of 78% year-over-year.
• Net income attributable to Weibo was $73.5 million, a boost of 184% year-over-year, and diluted net income per share was $0.33, contrast to $0.12 for the same period last year.
• Non-GAAP net income attributable to Weibo was $86.7 million, a boost of 144% year-over-year, and non-GAAP diluted net income per share was $0.38, contrast to $0.16 for the same period last year.
• Adjusted EBITDA was $103.1 million, a boost of 166% year-over-year, or 41% of net revenues, contrast to 26% for the same period last year.
• Monthly active users (“MAUs”) in June 2017 were 361 million, a boost of 28% year-over-year, 92% of which were mobile users. Average daily active users in June 2017 were 159 million, a boost of 26% year-over-year.

The stock closed its last trade at the price of $86.26, while exchanging hands with the volume of 4039943 shares contrast to its average daily volume of 2.69M shares. Trading volume is an important technical indicator a shareholder uses to confirm a trend or trend reversal. It is generally higher when the price of a security is changing, as the strength of any given price movement is measured mainly by the volume and shifts in trade volume can make observed price movements more significant. News about a company’s financial status, products, or plans, whether positive or negative, will typically result in a temporary increase in the trade volume of its stock. Higher volume for a stock is also an indicator of higher liquidity in the market. For institutional shareholders who wish to sell a large number of shares of a certain stock, lower liquidity will force them to sell the stock slowly over a longer period of time, to avoid losses because of slippage. The stock, as of recent close, has shown weekly upbeat performance of 11.09% which was maintained at 25.44% in 1-month period, and is up 112.45% in this year. The company now has a market value of $18.74B.

The stock, after recent close, is 16.93% above their SMA 50 and 14.19% from SMA20 and is 52.07% above than SMA200. 29.60% shares of the company were owned by institutional investors. The company has 25.48 value in price to sale ratio while price to book ratio was recorded as 23.13. It beta stands at 2.64.

The average 12 month target price among brokers that have covered the stock in the last year is $85. Analyst mean recommendation for this stock stands at 1.899. Analyst recommendations as stated on FINVIZ are rated on a 1 to 5 scale. 1 is equivalent to a buy rating, 3 a hold rating, and 5 a sell rating. The consensus recommendation is the average rating on a stock by the analyst community.