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Thursday, Aug 29
Citi reiterates Buy rating on Shanda, questions G-Home strategy
- Citi reiterates its Buy rating and PT of $4.75 on Shanda Games (GAME +0.7%) following the company's Q2 results.
- Citi, however, is doubtful of Shanda's strategy of developing its G-Home platform rather than using established channels such as third-party Android app stores. "The company hopes to leverage the success of Million Arthur in China to attract more gamers to the G-Home platform ... We are cautious on how this strategy would work out, mainly due to the limited user base of Shanda Games."
- According to the bank, Baidu, Tencent, and Qihoo's own app stores "are likely to consolidate more mobile app traffic and leave smaller app stores behind." Baidu acquired mobile app distributor 91 Wireless in July for for $1.9B.