New York, Jan. 8 (Xinhua) -- Shares of Weibo traded lower in U.S. stock market after multinational investment bank Morgan Stanley downgraded the company's stock from Overweight to Equal-Weight on Tuesday, according to publicly listed corporate information.
Shares of the Chinese social media site (SMS), often dubbed as Chinese equivalent of Twitter, closed at 59.08 U.S. dollars per share, plunging 5.67 percent as of 4:00 pm EST (2100 GMT).
The sharp loss in the company's stock price came following an increase of 2.29 percent on Monday, with the closing value settled at 62.63 dollars.
Its parent company China's tech giant Sina, which holds a dominant voting stake in Weibo, also fell 3 percent by the closing hour on Tuesday.
Weibo has suffered slimmer margins amid heavier investment and more competition from smaller counterparts, Grace Chen, a Morgan Stanley analyst, was quoted as saying on Tuesday by financial market information service Seeking Alpha.
Listed on the tech-heavy Nasdaq in April 2014, the microblogging network, however, announced upbeat earnings results for the third quarter ending Sep. 30, 2018, which was a major indicator for evaluating Weibo's business performance.
The company recorded net revenues of 460.2 million dollars for the quarter, up 44 percent year-on-year, which mainly came from advertising and marketing activities, according to its third quarter earnings report released on Nov. 28, 2018.
It also reported earnings per share (EPS) of 0.73 dollar for the quarter, a key metric for calculating the profit a company generates, which was higher than the 0.45 dollar EPS during the same period last year.
Monthly active users had a net addition of approximately 70 million users year-on-year and reached 446 million in September 2018, the report said, signaling positive development momentum for the SMS.
Weibo Corporation is estimated to report its earnings for the fourth quarter of 2018 on Feb. 12, according to Nasdaq's earnings calendar.
Morgan Stanley was one of the underwriters for Weibo to go public in the United States in 2014. It worked closely with the company to determine the stock's initial offering price and has closely tracked the stock's performance since then.
Major investment banks, such as Goldman Sachs, Citigroup and Barclays, normally offer ratings for certain stocks as a reference for general investors when they make purchasing or selling decisions.
