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A selection of Netflix original content sits displayed in the Netflix app on an Apple iPad tablet device in this arranged photograph in London.

Jason Alden | Bloomberg | Getty Images

A selection of Netflix original content sits displayed in the Netflix app on an Apple iPad tablet device in this arranged photograph in London.

Shares of Netflix rose 1.5 percent in after-hours trading Thursday after an analyst at UBS upgraded the video-streaming giant.

Analyst Eric Sheridan hiked his rating on the stock to buy from neutral. He also raised his price target to $410 from $400 per share, implying a 26 percent upside from Thursday’s close of $324.66.

In a note to clients titled “Taking The Blindfold Off,” Sheridan cited the success of Netflix’s content, solid subscriber momentum and a better understanding of the headwinds the company has faced recently.

“After six months of stock underperformance & key debates emerging about competition, margins & FCF, we think these debates are better understood by investors and reflected in the current stock price,” Sheridan wrote. “With content spend now at a scale of the major media companies and titles continuing to demonstrate outsized marketplace success, we see the moat around NFLX’s global positioning widening and its long-term secular winner status remaining intact.”

Netflix shares have been on fire to start off 2019, rising 21 percent in the first seven sessions of the year. The surge in Netflix comes after the stock plummeted more than 28 percent in the fourth quarter of 2018.

“Over the past months, the potential for new (& more pronounced) competition for both subscribers and to source original/licensed content among regional & global streaming media companies has caused NFLX’s stock volatility to remain pronounced,” Sheridan said.

“However, looking at the global opportunity among home broadband (~790m global broadband households (ex-China) in FY2023) and/or mobile device users (~2.9bn global smartphone users (ex-China) vs. NFLX estimated penetration of ~20% in FY2023), we see a long runway for NFLX subscriber growth that remains intact despite increased competition,” he added.

— With reporting from
Michael Bloom
.

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SoftBank-backed India hospitality chain OYO plans for China market

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A Chinese national flag flies in front of a building under construction in the central business district of Beijing, China.

Giulia Marchi | Bloomberg | Getty Images

For many foreign firms, China’s market is a notoriously tough nut to crack.

Tech giants such as Amazon, eBay and Uber — which have a significant market presence in the United States — all called it quits on China after finding themselves unable to survive the cutthroat competition with local firms there.

But Indian budget hotel chain, On Your Own Rooms, managed to be the exception to the rule.

The Softbank-backed hotel start-up was founded in India in 2013, and has since grown to become one of South Asia’s largest hotel and accommodation chains.

Since OYO Rooms ventured into the Chinese market in November 2017, it has expanded at a breakneck pace. OYO Jiudian — its Chinese subsidiary — currently has nearly 10,000 hotels and 450,000 rooms across 320 cities under its name.

Why design a global company that will never be successful, versus a local entrepreneur? … That mindset enabled us to think two levels ahead of anybody else.

Ritesh Agarwal

chief executive officer of OYO Rooms

“In a brief period, we have emerged as the country’s second-largest hotel group and company,” Sam Shih, the chief operating officer of OYO Jiudian, told CNBC.

China is the company’s biggest market today, OYO’s Chief Executive Officer Ritesh Agarwal said at a travel conference in Singapore in late May.

“We’re opening roughly 10 to 12 buildings a day in China,” Agarwal announced at the inaugural Skift Forum Asia.

He outlined two key traits of his business that allowed the company to reach the success it has in China’s market: strategic partnerships and a local entrepreneurial mindset.

Strong partnership

Agarwal said at the conference that the company has signed a “very strong, strategic partnership” with Ctrip, China’s largest online travel aggregator (OTA).

“OYO Hotels used to distribute on Ctrip, but we had a very local traveler partnership — it was never really at a brand level,” Agarwal said.

OYO’s “great working relationships” with prominent travel aggregators like Ctrip opens up new opportunities for the hotel chain and strengthens its reach to local communities, Shih told CNBC.

The OYO Dongxing Wenquan Hotel in Zhengzhou, China.

OYO China

That partnership will help its Chinese subsidiary reach its goal of giving China’s middle-income population — estimated by the government to be about 400 million, or less than a third of the population — a “great living space” for less than 150 Chinese yuan ($21.71) per night, Shih added.

“We’re excited by the possibilities of these mutually beneficial relationships,” he said.

Entrepreneurial mindset

OYO Jiudian’s success also stems from how it’s positioned itself in the world’s second-largest economy, Agarwal said.

When OYO entered the Chinese market, the company viewed itself as local Chinese entrepreneurs “who were copying OYO Global,” he explained.

“Why design a global company that will never be successful, versus a local entrepreneur? … That mindset enabled us to think two levels ahead of anybody else,” Agarwal said.

With that in mind, the hotel chain “nativized” its offerings from the “point of view of a traveler in the country and what was lacking from his/her experience earlier when OYO was not around,” COO Shih said.

“For instance, most foreign companies look at recruiting bilingual management teams in a different country,” he explained. “We didn’t make that a criterion because a Chinese company operating in the country wouldn’t have that constraint — and if we had that constraint, we would narrow our talent pool.”

This helped the company to build a strong team of over 7,000 “OYOpreneurs” in China, with less than 20 of them English-speaking, he added.

“In short, OYO copied what OYO itself has been executing since its inception in India to gain this momentum in China,” Shih said.

Big bets on China

When asked about the firm’s plans for the Chinese market, Shih said the company is “betting big on China” as it is their “home market.”

Today, OYO Jiudian makes up less than 2% of the country’s lucrative accommodation market — which stands at approximately 35 million rooms, Shih said.

He said OYO has allocated $600 million from the $1 billion it obtained from its last round of funding in order to “strengthen our capabilities for the market and drive our next wave of growth in the country.”

“We have an incredible opportunity ahead of us and we are just getting started,” Shih added.

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St Louis Blues beat Boston Bruins to clinch maiden NHL’s Stanley Cup

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The St. Louis Blues celebrate after defeating the Boston Bruins in Game Seven to win the 2019 NHL Stanley Cup Final at TD Garden on June 12, 2019 in Boston, Massachusetts.

Rich Gagnon | Getty Images

The St. Louis Blues won the National Hockey League’s Stanley Cup for the first time with a 4-1 win over the Boston Bruins in the decisive seventh game of the championship series on Wednesday.

With the victory, the visiting Blues not only completed a remarkable turnaround considering they were dead last in the NHL in early January but also ended the longest wait in NHL history — 51 seasons — for a team to win their first championship.

The Blues scored two goals late in the first period and then put on a defensive masterclass while Jordan Binnington made 32 stops, including the save of the game when he got a leg out to stop by Joakim Nordstrom from in close midway through the third.

The Bruins, who had never before hosted a Game Seven of a Stanley Cup Final, made a solid start and created all sorts of pressure but it was the Blues who jumped out to an early 2-0 lead despite being outshot 12-4 in the opening frame.

Ryan O’Reilly opened the scoring with about three minutes left in the period when he cleverly re-directed a shot from the point by Jay Bouwmeester that went right through Boston goalie Tuukka Rask’s legs.

Blues defenseman Alex Pietrangelo added another with eight seconds left in the period when he skated in and used a nifty backhand deke to beat Rask and silence the stunned home crowd.

St. Louis nearly added a third midway through the second period but Zdeno Chara managed to swat the puck away from the goal line after a shot from Brayden Schenn went off the crossbar and Rask’s shoulder before dropping in the crease.

Schenn did make it 3-0 when he took a centering pass from Vladimir Tarasenko and fired it off the post and past Rask with under nine minutes to play before Zach Sanford put the game out of reach with his first of the playoffs with under five minutes to play.

Boston broke Binnington’s shutout bid when Matt Grzelcyk found the net with just over two minutes to play.

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Riot police and protestors clash over extradition

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10 Hours Ago

Large crowds of protesters gathered around the local legislature as lawmakers postponed a debate on a legal change that’s been condemned by hundreds of thousands in the city. The protesters are vowing to stop a government plan to allow extraditions to mainland China, but the heart of the demonstration is the fight against the city ceding its autonomy to Beijing. Police threatened action and later fired tear gas at protesters.

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