NEW YORK (AP) -- Shares of several Chinese online gaming companies rose Tuesday as a Susquehanna Financial analyst issued largely bullish commentary on the sector.

Shanda's American Depositary Shares rose $1.41, or 3.9 percent, to $37.81 in afternoon trading. During the past year, the stock has traded between $13.63 and $37.03.

In a note to clients Tuesday, Susquehanna Financial Group analyst C. Ming Zhao reiterated a "Positive" rating for Shanda and said the company's third-quarter guidance looks too conservative. He anticipates Shanda will beat the high end of its guidance for 11 percent sequential revenue growth.

"The third quarter's strength has been driven by strong seasonality of its casual games, as well as better monetization of its massive multiplayer games," the analyst wrote.

But to keep growing, Shanda needs to launch its game "Changchun Online" during the fourth quarter, he cautioned.

Also Tuesday, online gaming company NetEase.com Inc.'s American Depositary Shares rose 27 cents to $17.77.

Zhao reiterated his "Positive" rating for NetEase. He said that the company might see weakness in its third quarter due to larger-than-expected drop in players of its "Westward Journey Online 3" game after NetEase started charging users to play.

Even so, "we view pullbacks as attractive entry points," he wrote.

Meanwhile, shares of Sohu.com Inc. declined 96 cents to $39.51, despite Zhao's upbeat comments for the Internet portal and online game operator.

In his note, Zhao also repeated a "Positive" rating for Sohu and called its third-quarter outlook for $7 million in revenue too conservative. He estimates the company's recently-released game "Tian Long Ba Bu" is the "best performer in 2007 in terms of growth," and thinks it could generate $9 million to $10 million in the quarter.