Tuesday, October 25, 2005

Hurry, HURRAY!

HURRY is a small wireless tech service company from China and it is listed on Nasdaq(HRAY). What's new about HURRAY is their annoucement on a music downloading deal with Baidu a couple days ago.

The company's financial preformance looks quite outstanding in the last two years. Revenue grew from $23.1 million to $53.4 million and net income grew from $4.5 million to $17.2 million in year 2004 over year 2003. The company is trading at only $200 million market cap and PE ratio of 11.

Sounds like dirty cheap, isn't it?

One big problem with the company is the technology they are serving is dying. The WAP service as a 2G technology has no future for 3G data intensive applications. In the latest Quarter, HURRAY showed just that. Though a 25% growth over year ago quarter, it only grew merely one half percentage point over previous quarter.

However, the company has all the technology at hands to serve the 3G wireless market which will finally kick in either at year end of early next year.

What is a big hidden jewel in HURRAY is the wireless music downloading business. HURRAY has already allianced with the largest mobile operator in China, China Mobile that takes care of online payment for the service.

In May, HURRAY released a single song exclusively through the wireless service which has garnered around $200,000 dollars. Three days ago, they signed alliance agreement with Baidu to release a new song from a movie super star turned pop star exclusively through Baidu and their own wireless downloading service.

Today, HURRAY again signed agreement with management company of Supergirl second runner-up Liangying Zhang (who is very hot in China) to market her next album exclusively through HURRAY's wireless service.

The latest arrangements are good indications that the company is remodeling itself from a 2G wireless player to a 3G multimedia wireless player. The 3G wireless service market has tremendous potential in China as long as it starts soon which is much less uncertain day by day.

The company is going to release 3rd quarter earnings on Nov 14. It worth a close watch and listen to what management has to say about the latest arrangement with Baidu and result of the first two-week's downloading performance which is attractiing huge crowd on Baidu.




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