The Research Of The Citron Of U.S.Shorting The Qihoo360of China

In recent decades, many companies go abroad to seek overseas capital market funding, especially seeking financing in the capital market of the United States is the first choice of many companies, these enterprises have brought about several waves of overseas listing. But to our surprise, since the end of2010, The short-sellers represented by citron, muddy waters have been shorting China concept stocks frequently in the United States, accounting fraud to hide, failing to submit the annual report timely and information disclosure not in conformity with the trading rules, not meeting the conditions and outdated business model appeared in newspapers frequently, which caused the declining of the stocks’ value of many companies, even suspension, delisting. But qihoo360listed in the United States miraculously and successfully resist the sing empty of the short-seller citron, which provides valuable experience for those China concept stocks that sank into the crisis. Since November2011, the Chinese qihoo360had been attacked seven times by American short-seller citron consecutively. Citron attacked qihoo360mainly in three aspects, first of all, citron claimed that qihoo360adopted a backward business model, the business model is about to be eliminated, there is no guarantee of the company’s future development; Secondly, citron said that the financial report of qihoo360was fraud, Qihoo360overstated revenues, many data are not real, and the target price of qihoo360is$5; Thirdly, citron also said qihoo360’s management had some historical problems. But the seven consecutive attacks that citron sing empty qihoo360didn’t work, largely because qihoo360could response quickly and timely in the face of citron’s attack. Qihoo360can provide convincing financial report in detail, and qihoo360’s business model is clear, plus some other factors, qihoo360’s share price has been strong, citron singing empty qihoo360failed. The case gives us much enlightenment, especially for Chinese enterprises and China’s capital market. For the companies which want to be listed in overseas, first of all, they should have correct motives, while the listed companies should strengthen the information disclosure and market management. The companies should communicate with overseas investors, and get their approval. Compared with the United States capital markets, China’s capital market should improve the system of information disclosure and create a fair and transparent market; promote the management of investor relations and cultivate a good market order; at the same time we should intensify the supervision, and punish the irregularities of market, and guarantee the quality of listed companies.