Youku.com (YOKU) Shares Dip as Susquehanna Says Tencent Not Interested, Downgrades

Shares of Youku.com (Nasdaq: YOKU) are down more than 7 percent Wednesday afternoon following an earlier downgrade from Susquehanna's Chun Ming Zhao.

The analyst reduced his investment rating on the so-called "YouTube of China" from Positive to Neutral but maintained a $21 price target.

While the analyst cited valuation (shares are up 20 percent since a Susquehanna upgrade on Sept. 23rd), he also noted his belief Tencent is unlikely to invest in Youku or use the service as a way to spur growth in the online video market. The Susquehanna analyst feels this industry will eventually consolidate to three to five players, however warns this will take time.

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