Sohu.com Limited American Depositary Shares (SOHU)
StalwartFairStock Score: 76/100 — HIGH CONVICTION
Key Financials
| Current Price | $15.3 |
| Market Cap | $458M |
| P/E Ratio | 1.98 |
| ROE | 17.5% |
| Dividend Yield | —% |
| Sector | Communication Services |
Strengths
- High return on equity of 35.8% demonstrating efficient capital deployment
- Conservative balance sheet with debt-to-equity of just 0.03, providing financial flexibility
- FairStock composite score of 76/100 places it in the top tier across value, quality, and momentum factors
Concerns
- Weak Piotroski F-Score of 3/9 suggests deteriorating financial quality across multiple dimensions
- Altman Z-Score of 1.7 places it in the financial distress zone—elevated bankruptcy risk
AI Analysis
Sohu.com Limited American Depositary Shares is a micro-cap communication services company valued at $458 million. Revenue stands at $584 million. From a quality standpoint, Sohu.com shows weak Piotroski F-Score of 3/9 signaling deteriorating fundamentals and distressed Altman Z-Score of 1.7 warrants caution. On valuation, the stock is deeply undervalued on a P/E basis at 1.1x, with offers a 88% margin of safety vs Graham Number of $124. Growth dynamics show revenue growing at 5.6% and profit growth of 1148.7%. Our composite FairStock Score of 76/100 reflects strong fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.
Bull Case
The market underappreciates Sohu.com's consistent 36% ROE at just 1x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.
Bear Case
Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the communication services space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.
Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer