Chinese Internet portal firm Sina (SINA) has been blasted in 2014. SINA stock is down more than 42% so far this year, as revenues have been negatively impacted by a Chinese anti-pornography crackdown. In fact, Sina’s online video licenses were revoked in April, and the company was fined 5.1 million yuan in May for allowing “unhealthy and indecent content” on its servers.

As you can see, the backdrop for tomorrow night’s second-quarter earnings report is not all that promising. Still, the company should benefit from increased online traffic due to the recent World Cup, even if Sina was unable to carry video. Overall, Wall Street is looking for a profit of 9 cents per share, with revenue seen rising 14% to $179.2 million.

Additionally, despite recent negativity in the brokerage community — T.H. Capital downgraded Sina to “hold” this week — the general consensus among the group is heavily bullish. Specifically, data from Thomson/First Call reveals 19 “buys,” four “holds” and no “sells” for SINA stock. What’s more, the current 12-month price target of $65 represents a roughly 39% premium to yesterday’s close at $47.86.

While most investors would see this confidence as a boon for Sina, the contrarian in me says that if the company fails to produce results in tomorrow’s quarterly report, we could see a round of downgrades or price-target cuts as SINA bulls reevaluate their stance on the stock.

Options traders also are leaning toward the bullish camp. SINA’s August/September put/call open interest ratio arrives at 0.73, with calls outnumbering puts among near-term options. This reading grows more bullish when you zero in on the weekly Aug. 15 series of options, falling to 0.6. Traders appear to be focusing on the overhead weekly Aug $50 strike, where 4,758 call contracts reside, while the Aug $45 strike has also garnered attention with 3,273 puts open.

Click to EnlargeOverall, weekly August options are pricing in a potential post-earnings move of about 7.2%. This places the upper bound near $51.46, which could put SINA stock on course for an upside breakout of its recent trading range. Meanwhile, the lower bound lies at $44.54, hinting at a downside breakout for SINA should tomorrow’s quarterly report go sour.

2 Options Trades on SINA Stock

Bull call spread: For traders looking to follow the bullish crowd, a Sep $47.50/$50 bull call spread might fit the bill. At the close on Tuesday, this trade was offered at $1.09, or $109 per pair of contracts. Breakeven lies at $48.59, while a maximum profit of $1.41, or $141 per pair of contracts, is possible if SINA closes at or above $50 when September options expire.

Selling puts: Alternately, if you are concerned that SINA’s results might fall flat with Wall Street, a weekly Aug $45 put sell also has potential. After the close last night, the weekly Aug $45 put was bid at 59 cents, or $59 per contract. The upside to this put sell strategy is that you keep the premium as long as SINA stock closes above $45 when weekly August options expire at the close of trading this Friday. The downside is that should SINA trade below $45 at expiration, you could be assigned 100 shares for each Aug $45 put sold at a cost of $45 per share — so make sure you have the funds for this kind of transaction before making the trade.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.