A History of Outperforming Analyst Forecasts and Beating the Odds: NetEase Inc. (NTES)

NetEase Inc. (NASDAQ: NTES) stock jumped 0.63% on Thursday to $101.76 against a previous-day closing price of $101.12. With 0.71 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.03 million shares. The 52-week range on NTES shows that it touched its highest point at $110.82 and its lowest point at $53.09 during that stretch. It currently has a 1-year price target of $123.99. With its current market cap of 65.32 billion, NTES has annualized dividend of $1.70 while the current yield stands at 1.67%. Beta for the stock currently stands at 0.61.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of NTES was up-trending over the past week, with a rise of 3.90%, but this was down by -0.89% over a month. Three-month performance surged to 3.16% while six-month performance rose 21.39%. The stock gained 16.44% in the past year, while it has gained 40.11% so far this year. A look at the trailing 12-month EPS for NTES yields 5.36 with Next year EPS estimates of 6.52. For the next quarter, that number is 1.45. This implies an EPS growth rate of 19.50% for this year and 2.20% for next year. EPS is expected to grow by 18.41% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 11.40%.

Float and Shares Shorts:

At present, 643.76 million NTES shares are outstanding with a float of 127.22 million shares on hand for trading. On Aug 30, 2023, short shares totaled 3.32 million, which was 0.51% higher than short shares on Jul 30, 2023. In addition to Mr. Lei Ding as the firm’s Founder, CEO & Director, Mr. Zhaoxuan Yang serves as its Chief Financial Officer.

Institutional Ownership:

Through their ownership of 14.70% of NTES’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 9.40% of NTES, in contrast to 4.26% held by mutual funds. Shares owned by individuals account for –. As the largest shareholder in NTES with 1.53% of the stake, Invesco Advisers, Inc. holds 10,042,332 shares worth 10,042,332. A second-largest stockholder of NTES, UBS Asset Management Switzerland, holds 8,297,329 shares, controlling over 1.26% of the firm’s shares. UBS Asset Management is the third largest shareholder in NTES, holding 6,829,072 shares or 1.04% stake. With a 1.08% stake in NTES, the Invesco Developing Markets Fund is the largest stakeholder. A total of 7,121,250 shares are owned by the mutual fund manager. The Government Pension Fund – Global, which owns about 0.87% of NTES stock, is the second-largest Mutual Fund holder. It holds 5,734,252 shares valued at 623.54 million. Dodge & Cox International Stock F holds 0.72% of the stake in NTES, owning 4,737,826 shares worth 515.19 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Jun 29, 2023, NTES reported revenue of $23.16B and operating income of $4.95B. The EBITDA in the recently reported quarter was $5.40B and diluted EPS was $8.00.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for NTES since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With NTES analysts setting a high price target of $1,099.62 and a low target of $509.13, the average target price over the next 12 months is $897.98. Based on these targets, NTES could surge 980.6% to reach the target high and rise by 400.32% to reach the target low. Reaching the average price target will result in a growth of 782.45% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Dividends & Yield:

In terms of dividends, NTES has a current ratio of $1.7, which is $1.7 over the trailing 12-months, while a dividend of $1.01 is likely to be paid on average over the next five years. Dividend yield is another indicator that appeals to many investors, and NTES currently yields $1.67. In the past year, NTES’s dividend yield has been $1.67, but when looking at the stock over the past five years, its yield has been $1.26. Accordingly, NTES has a current buyback yield of $0.2. This was $0.2 for the TTM.

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