Consumer Discretionary Nov 20, 2020 11:19 AM (GMT+8)
Daiwa published a research report and raised the target price of Netease from HK $172 to HK $187, maintaining the "buy" rating. Netease's revenue in the third quarter increased by 30.6% year-on-year, 3% higher than market expectations. Although the revenue of mobile games is large and expected to be 5% lower, it reflects the company's ability to cash in old games. Revenue growth is expected to accelerate in the fourth quarter due to the delay in revenue. Daiwa believes that the profit pressure from online education business is generally reflected in the quarterly performance. It is expected that major games will be launched in the first half of next year, and the rising contribution of overseas markets will also help drive the stock price to be revalued.
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