CLSA analyst Elinor Leung upgraded iQIYI to Outperform from Underperform with a price target of $27, up from $23.50. The online entertainment service in China is trading down 9%, or $2.11, to $22.31 in afternoon trading. The coronavirus outbreak is boosting the company's traffic and paying users, Leung tells investors in a research note. The analyst views the company as "resilient" from the coronavirus outbreak and believes it has a strong content pipeline. iQIYI is introducing new fee models and plans to cut monthly subscription discounts to boost 2020 membership average revenue per user, Leung says.
Bullish option flow detected in iQiyi with 18,185 calls trading, 1.1x expected, and implied vol increasing almost 25 points to 102.72%. 4/30 weekly 20 calls and Apr-21 17 calls are the most active options, with total volume in those strikes near 8,400 contracts. The Put/Call Ratio is 0.22. Earnings are expected on May 13th.