Sina Needs to Check Site User IDs, But at What Cost?

According to Piper Jaffray, a Chinese blog said last week that Sina might have to pay up to 2 RMB per user ID checked for its microblogging site Sina Weibo under the new government regulations. He also thinks based on checks in China (NYSE:FXI), the variable cost to Sina to perform checks is almost nothing.

The firm believes investors have already extensively discounted Weibo at current valuation levels and maintains an Overweight rating on Sina shares. Deutsche Bank selected Baidu (NASDAQ:BIDU) and Sina (NASDAQ:SINA) as Top Picks and said they feel online ads are still in a secular growth phase.

Subsequent to meeting with Sina’s management, Roth Capital stated the company does not anticipate its costs to increase as a result of new rules forcing it to validate users’ names. The firm believes that worries about this issue are exaggerated, and it restates a Buy rating. According to China Daily, Chinese Prime Minister Wen Jiabao asked the nation’s financial sector to give additional support to the country’s companies. Small businesses and infrastructure projects will be offered highest priority for credit, Wen added.

Here’s how Chinese internet stocks are reacting to the news:

Baidu, Inc. (NASDAQ:BIDU): BIDU shares recently traded at $125.68, up $5.57, or 4.64%. They have traded in a 52-week range of $100.95 to $165.96. Volume today was 3,034,167 shares versus a 3-month average volume of 6,291,980 shares. The company’s trailing P/E is 48.28, while trailing earnings are $2.60 per share.

Sina Corp. (NASDAQ:SINA): SINA shares recently traded at $52.83, up $4.63, or 9.61%. They have traded in a 52-week range of $46.86 to $147.12. Volume today was 4,024,003 shares versus a 3-month average volume of 5,412,130 shares. The company’s trailing earnings are $-6.42 per share.

Sohu.com Inc. (NASDAQ:SOHU): SOHU shares recently traded at $52.20, up $3.46, or 7.1%. They have traded in a 52-week range of $45.40 to $109.37. Volume today was 820,341 shares versus a 3-month average volume of 1,390,270 shares. The company’s trailing P/E is 12.00, while trailing earnings are $4.35 per share.

Youku.com Inc (ADR) (NYSE:YOKU): YOKU shares recently traded at $17.11, up $1.54, or 9.89%. They have traded in a 52-week range of $13.76 to $69.95. Volume today was 1,237,819 shares versus a 3-month average volume of 2,346,810 shares. The company’s trailing earnings are $-0.27 per share.

E Commerce China Dangdang Inc (ADR) (NYSE:DANG): DANG shares recently traded at $5.22, up $0.25, or 5.03%. They have traded in a 52-week range of $4.11 to $36.40. Volume today was 867,284 shares versus a 3-month average volume of 2,093,080 shares. The company’s trailing earnings are $-0.20 per share.

Renren Inc (NYSE:RENN): RENN shares recently traded at $3.48, up $0.08, or 2.35%. They have traded in a 52-week range of $3.21 to $24.00. Volume today was 1,962,051 shares versus a 3-month average volume of 3,612,950 shares. The company’s trailing earnings are $-0.85 per share.