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Huatai Securities Drops TP of TENCENT (00700.HK) to $440, Predicts 2Q Adj. NP to Rise 27% YoY
2023/07/20
Huatai Securities anticipated that the 2Q23 operating revenue and adjusted net profit of TENCENT (00700.HK) to burgeon 13% and 27% YoY, respectively, in line with its previous forecasts.
The broker remained upbeat on the prospect of accelerated business growth for TENCENT in the second half of the year, owing to:-
1. The progressive launches of new game titles
2. Incremental investments from e-commerce
3. Verticals ads on Video Accounts
4, Lower base for cloud business
5. Continued rebound for offline payment and
6. Consistent gross margin improvement on optimization of revenue structure.
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The report elaborated that the valuation of TENCENT has yet to fully reflect the long-term commercial potential of blockbuster game titles and WeChat.
The gross margin of the group was forecast to narrow by 0.8 ppts QoQ in 2Q23.
Huatai Securities tweaked the 2023-25E adjusted net profit for the company by -2.6%/ -2.1%/ +0.6% to RMB147.5 billion/ RMB177.4 billion/ RMB208.8 billion.
The target price on the stock was trimmed from HKD460 to HKD440, with its rating kept at Buy.
Source: AAStocks Financial News
http://www.aastocks.com/en/stocks/news/ ... -news/AAFN