Shanda Interactive Entertainment Ltd ADR (NASDAQ:SNDA)

Online company in massively populated country with lots of growth in technology and wealth. People want games.

a serial disappointer in a very scary Chinese market.

On-iIne gaming is the future and the Chinese kids can't get enough.
Shanda changed their business model to subscription earlier in 2006, but this seems to be working out well so far.

p/e is too high indicating it's to lucratively
priced.

It has been building upon the new model and looks like it is paying dividends

What's not to like in this entertainment, content, global internet stock? I have done well from it's past performance and believe it can break out of it's technicals this qtr.

The words China and Gaming in the same sentence gets me all moist and giddy.

Improving earnings, leader, free cash flow, huge market

For anyone who is a game enthusiast and is always looking for interesting interactive games, the only place to be is Shanda Interactive. Shanda is the third largest online gaming company in China. The company has captured around 16% of the mammoth Chinese gaming market, while facing stiff competition from market leader NetEase. Its core product online games are mainly segregated into massive multi player online role playing games (MMORPG’s) and casual games.

MMORPGs including the company’s in-house developed games like Magic Land and The Age, produce around 76% of the company’s overall revenue. On the other hand, casual games, targeted toward less-experienced online game players and home users, generate 18% of the company’s overall revenue. The casual games offer a range of games like Maple Story and Three kingdoms.

In the coming years, Shanda would reap the benefits of change in its revenue model from traditional subscription-base to Free-to-Play and Pay-for in-Game Value. This new model will assist in increasing the user base and will have a positive affect on Active paying Accounts, which is currently around the 2.14 million mark. Placed in an immensely attractive Chinese market where online gamers are set to increase to 80 million by 2010, out of which half of them are expected to be paying players, and backed by high penetration of broadband connection to 130 million households growth of Shanda looks promising.

Leader in online game market in China

gotta love china internet I remember pre bubble US internet, made a bundle and got out clean

They took a gamble by changing their revenue model and trying to take this to the next level/prempt competition in a soon to be saturated/highly competitive market. Looking at similar models in other avenues it's got a chance to succeed. The temporary dip in earnings is part of the gamble and the reaction from the market is typical in its short-term focus on. Question is how much will the gamble payoff. Even a decent increase that gets them somewhere close to earlier performance should justify a premium over current price. Anything over that is gravy - and there could be a lot of it.

Looks like earnings are rebounding after they changed from fee for play to free play+pay for extras. Earnings rebounded from a loss a few quarters ago to $0.23, way ahead of expectations of $0.06. Unless I'm missing something, eps is heading for $1.00 if not there already on an annualize basis. I know their future depends on new successful games and continued earnings growth, and at this point, things look ok at $15 and $1.00 eps, stable user base. Could hit $20 in 2007.

Chen is incredible

no longer in the drivers' seat at this time in China, but in a good position to grow tremendously over the next few years and beyond. Jury still out on ceo.

Bottomed out. Good entry point for MMORG industry

This Chinese gaming company is down, but not out. Look for this one to turnaround with the release of Archlord.