Tencent 0700 03 (Aug 18 - Dec 19)

Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Mon Nov 12, 2018 11:22 am

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<Research Report>G Sachs Lowers TENCENT TP to $397, Sees 3Q Non-GAAP NP Up 14%

Goldman Sachs previewed in its report that TENCENT (00700.HK)'s 3Q18 non-GAAP net income will rise 14% yearly to RMB19.5 billion, while revenue will grow 24% yearly to RMB80.564 billion.

2018-2020 non-GAAP EPS estimates were trimmed by 3% /5% /6% to RMB9.37 /RMB12.47 /RMB16.3.

The broker kept Buy on TENCENT at the target price HKD397, lowered from HKD476.

Source: AAStocks Financial News
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Thu Nov 15, 2018 8:16 am

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Tencent powers to 64b yuan profit

by Tereza Cai

Tencent (0700) beat earnings expectations thanks to an increase in advertisement revenues and a whopping one-time gain, buying it time to find an answer for its plateauing core gaming business.

The social media titan's net profit for the first nine months increased 27 percent year-on-year to 64.49 billion yuan (HK$72.6 billion).

Net profit for the third quarter maintained the high annual growth of 30 percent to reach 23.33 billion yuan, beating the market expectations, mainly because of a windfall 8.8 billion yuan from investments, including the debut of Meituan Dianping (3690).

Revenues for the nine months climbed 33 percent year-on-year to 227.8 billion yuan.

Revenues for the third quarter rose 24 percent to 80.6 billion yuan, up 9 percent on a quarterly basis, at its slowest pace in three years as a Chinese clampdown on gaming licenses continued to hammer its bread-and-butter division.

The government has effectively frozen new game approvals, which means Tencent's been unable to make money off global hits Fortnite and PlayerUnknown's Battlegrounds.

While China is trying to combat gaming addiction and is reshuffling regulators, uncertainty persists with Tencent counting on its WeChat social network, advertising and belt-tightening to tide it over the drought.

For the third quarter, revenue from value-added services accounted for 55 percent of total revenue, representing 44.05 billion yuan down from 65 percent a year ago, and online advertising proportion increased 3 percentage points to 20 percent, amounting 16.25 billion yuan.

Revenue from other business spiked by 69 percent year-on-year to 20.3 billion yuan, mainly driven by the payment-related and cloud services.

Social network revenue was 18.2 billion yuan, up 19 percent year on year.

Total online game revenue was 25.8 billion yuan, down 4 percent year-on-year, 4 percentage points below Jefferies Hong Kong's estimate, among which PC game revenue was 12.4 billion yuan, down 15 percent year-on-year.

Total mobile game revenue was 19.5 billion yuan, up 7 percent year on year, 5 percentage points above Jefferies Hong Kong's estimate, mainly driven by new titles released in the third quarter including Free Fantasy Online Mobile, MT4 and Saint Seiya.

Total advertising revenue grew 47 percent year-on-year to 16.2 billion yuan, within which social advertising revenue was up 61 percent to 11.2 billion yuan, 13 percent above estimate, and media advertising revenue up 23 percent to 5.1 billion yuan, 6 percent below estimate.

The company plans to shift from the consumer internet to industrial internet, to help diverse industries embrace high-tech by using technologies such as cloud and artificial intelligence.

Source: The Standard

http://www.thestandard.com.hk/section-n ... r=20181115
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Fri Nov 16, 2018 8:39 am

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Tencent gains 6pc but outlook murky

Tencent (0700) was up 6 percent at HK$288 at the close in Hong Kong yesterday, leading gains on the Hang Seng Index.

But Tencent's inability to offer clarity on new game approvals took the gloss off its better-than-expected third-quarter update.

The company's management said it didn't have much of an update on the games approval process that has been at the center of the stock's more than US$230 billion (HK$1.79 trillion) loss of value since January.

JPMorgan Chase & Co has cut its price target to HK$345 from HK$400 and removed Tencent as top sector pick, as "approval suspension seems more serious than initially thought," analyst Alex Yao said.

Citigroup cut its price target to HK$392 from HK$420, since the outlook for games revenue growth remains murky as there is no sign of when approval will be resumed.

Morgan Stanley cut its price target to HK$370 from HK$420 because "cautious forecasts are prudent given macro risk," according to analysts including Grace Chen.

Source: Bloomberg

http://www.thestandard.com.hk/section-n ... r=20181116
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Fri Nov 16, 2018 10:27 am

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Tencent Launches Playtime Sharing for 'Honor of Kings' Accounts, Re-tests Face ID Verification

TENCENT (00700.HK) announced the launch of a new playtime sharing function for 'Honor of Kings' accounts from 15 November to promote healthier use of Internet among the underaged. Such policy is rolled out in Beijing first, eventually spanning across the whole country.

Equally, the second sample testing of Face ID verification for 'Honor of Kings' has started in Beijing on the same day.

Under the new sharing function, each underage 'Honor of Kings' player is allowed a daily playtime of 1 hour (aged 12 and below) or 2 hours (aged above 12) only.

Source: AAStocks Financial News
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Tue Nov 20, 2018 7:11 pm

Chinese internet giant Tencent tightens control of WeChat content amid industry–wide clampdown

The move coincides with an industry-wide crackdown on content by Beijing, which wants vulgar content, gossip and fake accounts cleaned up

WeChat reduced the maximum number of accounts for companies to two from five previously, and to one account for individuals from two.

1.08 billion monthly active users.

WeChat has over 20 million official accounts.

Advertising revenue, which accounted for one fifth of total revenue in the past quarter, was up 47 per cent to 16.2 billion yuan (US$2.33 billion) driven by ads on WeChat’s Moments.


Source: SCMP

https://www.scmp.com/tech/apps-social/a ... ntent-amid
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Wed Nov 21, 2018 7:19 am

Why Tencent has struggled in 2018

by Daniel Roberts

Tencent’s revenue in the third quarter grew 24%, its slowest quarterly revenue growth in more than three years.

Fortnite (made by Epic Games, which is 40% owned by Tencent) and PlayerUnknown’s Battlegrounds (PUBG, made by Bluehole, which is 10% owned by Tencent).

In gaming, the government appears likely to set up a cap on the number of total game titles published in the industry.

It's advertising business is growing faster, particularly with its social ad business.

Tencent has also spent big on investments. It bought $400 million worth of shares in the $4.2 billion IPO of Meituan Dianping in September, and last year it teamed with JD.com to invest $863 million in Vipshop, a strategic shot at Alibaba.


Source: Yahoo Finance

https://finance.yahoo.com/news/tencent- ... 09899.html
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Thu Nov 22, 2018 8:15 am

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Tencent Music delays US$2b IPO

Tencent Music Entertainment, China's answer to Spotify, has postponed its New York initial public offering to early 2019, amid weak mood towards tech stocks and ongoing market jitters ahead of next week's G20 meeting in Buenos Aires.

The music streaming arm of Tencent (0700) has more than 800 million monthly users, and had initially penciled in an October launch for a US IPO of up to US$2 billion (HK$15.66 billion), but decided last month to delay until November in the hope that markets would settle.

Now, TME and its advisers have discussed pushing the deal into early 2019, according to two sources. No decision has yet been made, they added.

"Of course they want to get the deal done within the year, but meanwhile, they don't want to rush for the listing.

What they care about a lot is (getting) the right valuation, rather than the fast pace of the listing," said one person involved.

Source: Reuters

http://www.thestandard.com.hk/section-n ... r=20181122
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Fri Nov 23, 2018 9:54 am

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Tencent Music To Go Listing in US on 12 Dec, Valuation Cap US$25B: Rumor

Tencent Music, whose shares are held by TENCENT (00700.HK), is set to start international roadshow in early December, and go listing on 12 December, Mainland media quoted people with the knowledge of the matter.

The issuance size of Tencent Music's IPO will be less than US$1 billion, with a valuation of US$22-25 billion.

Source: AAStocks Financial News
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Wed Nov 28, 2018 9:42 am

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<Research Report>Macquarie: TENCENT Sees Ad, Cloud Biz as Growth Catalyst, TP $513

Macquarie said TENCENT (00700.HK) conducted four days of non-deal roadshows in Hong Kong and Australia, at which the management shared numerous business outlook and expected ad and cloud business to become structural growth momentum.

The broker maintained the profit forecast unchanged and reiterated the rating at Outperform with target price of $513.

Macquarie said 3Q online game of the company only made up 32% of revenue, against 59% three years ago.

Cloud business was expected to replace video as the main drag of profit next year, with improving ad profit and continuous cloud business.

Source: AAStocks Financial News
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Re: Tencent 0700 02 (Jan 15 - Dec 18)

Postby winston » Wed Nov 28, 2018 8:21 pm

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China Stocks With Long Term Upside: Tencent (TCEHY)

The big problem here is revenue deceleration. Margins are compressing, but they’ve been compressing for the past several years.

In early 2015, TCEHY had 60%-plus gross margins and 40%-plus operating margins. Big investments and a shift to lower-margin revenue streams have dragged margins way down since then.

Today, Tencent has 47% gross margins and 30% operating margins, and both of those metrics are rapidly dropping.

But, margin compression wasn’t a big problem for Tencent from 2015 to 2017 because revenue growth was big enough to offset margin compression. That is no longer the case.

Last quarter, revenue growth decelerated meaningfully. That deceleration negatively impacted the company’s bottom line, as its operating profits actually dropped year-over-year.

Therefore, unless Tencent’s revenue growth re-accelerates or its margin declines moderate, the outlook for Tencent’s profit growth isn’t all the great. At this point, with the Chinese economy slowing, no positive progress on U.S.-China trade talks, and Tencent’s top- and bottom-line issues, there is little reason to believe TCEHY stock will reach a positive turning point anytime soon.

Long term, though, the upside is compelling. This is a company with robust exposure to all things internet in China. Tencent operates China’s largest social media platforms — Weixin and WeChat — and they have more than 1 billion combined active users.

The company’s other social media and communication apps — QQ and Qzone — aren’t small either. They both have 500 million-plus monthly active users. Beyond social, Tencent is also the gaming giant in China, and it’s the top online games maker by revenue in the world.

TCEHY also owns China’s biggest digital video, news, music, and literature platforms. As if that weren’t enough, Tencent also operates China’s largest mobile payment platform and its largest mobile security network.

In other words, TCEHY not only has exposure to all things internet in China, it actually dominates all things internet in China. Thus, as goes the outlook for the growth of internet services in China, so goes Tencent.

Considering that demand for internet services is expected to continue growing rapidly in China, Tencent stock is still supported by a favorable multiyear growth outlook.

As a result, in the big picture, the near-term weakness of TCEHY stock price is a long-term buying opportunity. But, investors will want to wait for revenue growth turn the corner and/or margin declines to moderate before buying the dip.

Source: Investor Place
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