NTES

Netease Shs Sponsored American Deposit Receipt Repr 25 Shs

TMT


Presented:11/10/2017
Price:$302.87
Cap:$40.17B
Current Price:$82.05
Cap:$51.08B

Presented

Date11/10/2017
Price$302.87
Market Cap$40.17B
Ent Value$33.94B
P/E Ratio20.43x
Book Value$48.93
Div Yield1.07%
Shares O/S132.62M
Ave Daily Vol1,326,905
Short IntN/A

Current

Price$82.05
Market Cap$51.08B
NetEase, Inc. engages in the provision of online internet technology services. It operates through the following business segments: Online Games, Advertising, e-mail Services and E-commerce. The Online Games segment offers multi-player online role-playing games and mobile games. The Advertising segment involves banner advertising, channel sponsorships, direct e-mail, interactive media-rich sites, sponsored special events, games and contests. The e-mail Services segment comprise free and fee-based premium e-mail services. The E-commerce segment provides online selling and payment platform, e-reading applications, matchmaking services, online music, social network, personalized photo-based products, and online game-related accessories. The company was founded by Lei Ding in June 1997 and is headquartered in Beijing, China.

Publicly traded companies mentioned herein: Activision Blizzard Inc (ATVI), NetEase Inc (NTES), Tencent Holdings Ltd (700 HK)

Highlights

The presenter is long shares of NetEase (NTES), a Chinese video game publisher, viewing current sentiment as overly negative, while underestimating NTES’s strong IP and product portfolio, which he believes is set up for a strong 2018 - 2019. NTES trades at a discounted multiple to western video game publishers, and the presenter thinks there will be room for expansion as growth trends become more apparent. He models $23.00 in 2019 EPS, and uses an 18x P/E multiple, to target ~$440 for NTES shares when accounting for dividends and the smaller e-commerce business.

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Idea Discussion

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