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NetEase

DB:NEH
Snowflake Description

Excellent balance sheet with moderate growth potential.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
NEH
DB
$35B
Market Cap
  1. Home
  2. DE
  3. Media
Company description

NetEase, Inc. operates an interactive online community in the People’s Republic of China. The last earnings update was 62 days ago. More info.


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NEH Share Price and Events
7 Day Returns
0%
DB:NEH
0.8%
DE Entertainment
1.5%
DE Market
1 Year Returns
13.9%
DB:NEH
10.2%
DE Entertainment
-6.2%
DE Market
NEH Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
NetEase (NEH) 0% 14% 10.7% 13.9% 102.2% 387.4%
DE Entertainment 0.8% 6.3% 12.5% 10.2% 35.2% 74.6%
DE Market 1.5% 6% 8.5% -6.2% 10.7% 15.3%
1 Year Return vs Industry and Market
  • NEH outperformed the Entertainment industry which returned 10.2% over the past year.
  • NEH outperformed the Market in Germany which returned -6.2% over the past year.
Price Volatility
NEH
Industry
5yr Volatility vs Market
Related Companies

NEH Value

 Is NetEase undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of NetEase to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for NetEase.

DB:NEH Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 27 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 6.2%
Perpetual Growth Rate 10-Year DE Government Bond Rate 0.2%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for DB:NEH
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year DE Govt Bond Rate 0.2%
Equity Risk Premium S&P Global 6%
Entertainment Unlevered Beta Simply Wall St/ S&P Global 0.96
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.962 (1 + (1- 25%) (5.77%))
1.003
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 0.23% + (1.003 * 5.96%)
6.2%

Discounted Cash Flow Calculation for DB:NEH using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for NetEase is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

DB:NEH DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (CNY, Millions) Source Present Value
Discounted (@ 6.2%)
2019 7,675.19 Analyst x6 7,226.88
2020 10,501.94 Analyst x7 9,310.93
2021 12,315.25 Analyst x4 10,280.84
2022 13,446.75 Est @ 9.19% 10,569.75
2023 14,320.77 Est @ 6.5% 10,599.26
2024 14,982.15 Est @ 4.62% 10,441.07
2025 15,476.74 Est @ 3.3% 10,155.76
2026 15,844.97 Est @ 2.38% 9,790.08
2027 16,119.71 Est @ 1.73% 9,378.07
2028 16,326.38 Est @ 1.28% 8,943.51
Present value of next 10 years cash flows CN¥96,696.15
DB:NEH DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= CN¥16,326.38 × (1 + 0.23%) ÷ (6.2% – 0.23%)
CN¥273,852.27
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= CN¥273,852.27 ÷ (1 + 6.2%)10
CN¥150,014.98
DB:NEH Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= CN¥96,696.15 + CN¥150,014.98
CN¥246,711.12
Equity Value per Share
(CNY)
= Total value / Shares Outstanding
= CN¥246,711.12 / 131.33
CN¥2163.84
DB:NEH Discount to Share Price
Calculation Result
Exchange Rate CNY/USD
(Reporting currency to currency of NasdaqGS:NTES)
0.149
Value per Share
(USD)
= Value per Share in CNY x Exchange Rate (CNY/USD)
= CN¥1878.58 x 0.149
$279.31
Non-primary Listing Adjustment Factor 1 share in DB:NEH represents 0.86817x of NasdaqGS:NTES
(This could be a different class, a depositary receipt, a different currency, or all of these things.)
0.86817x
Value per Share
(Listing Adjusted, EUR)
= Value per Share (USD) x Listing Adjustment Factor
= $ 279.31 x 0.86817
€242.49
Value per share (EUR) From above. €242.49
Current discount Discount to share price of €238.00
= -1 x (€238.00 - €242.49) / €242.49
1.9%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price NetEase is available for.
Intrinsic value
2%
Share price is €238 vs Future cash flow value of €242.49
Current Discount Checks
For NetEase to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • NetEase's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • NetEase's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for NetEase's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are NetEase's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
DB:NEH PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in CNY CN¥47.54
NasdaqGS:NTES Share Price ** NasdaqGS (2019-04-23) in USD $274.14
NasdaqGS:NTES Share Price converted to CNY reporting currency Exchange rate (USD/ CNY) 6.726 CN¥1843.81
Germany Entertainment Industry PE Ratio Median Figure of 10 Publicly-Listed Entertainment Companies 19.82x
Germany Market PE Ratio Median Figure of 424 Publicly-Listed Companies 19.6x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of NetEase.

DB:NEH PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NasdaqGS:NTES Share Price ÷ EPS (both in CNY)

= 1843.81 ÷ 47.54

38.78x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • NetEase is overvalued based on earnings compared to the DE Entertainment industry average.
  • NetEase is overvalued based on earnings compared to the Germany market.
Price based on expected Growth
Does NetEase's expected growth come at a high price?
Raw Data
DB:NEH PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 38.78x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 27 Analysts
12.1%per year
Europe Entertainment Industry PEG Ratio Median Figure of 30 Publicly-Listed Entertainment Companies 1.67x
Germany Market PEG Ratio Median Figure of 269 Publicly-Listed Companies 1.56x

*Line of best fit is calculated by linear regression .

DB:NEH PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 38.78x ÷ 12.1%

3.2x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • NetEase is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on NetEase's assets?
Raw Data
DB:NEH PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in CNY CN¥353.45
NasdaqGS:NTES Share Price * NasdaqGS (2019-04-23) in USD $274.14
NasdaqGS:NTES Share Price converted to CNY reporting currency Exchange rate (USD/ CNY) 6.726 CN¥1843.81
Germany Entertainment Industry PB Ratio Median Figure of 14 Publicly-Listed Entertainment Companies 1.56x
Germany Market PB Ratio Median Figure of 574 Publicly-Listed Companies 1.84x
DB:NEH PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NasdaqGS:NTES Share Price ÷ Book Value per Share (both in CNY)

= 1843.81 ÷ 353.45

5.22x

* Primary Listing of NetEase.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • NetEase is overvalued based on assets compared to the DE Entertainment industry average.
X
Value checks
We assess NetEase's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Entertainment industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Entertainment industry average (and greater than 0)? (1 check)
  5. NetEase has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

NEH Future Performance

 How is NetEase expected to perform in the next 1 to 3 years based on estimates from 27 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
12.1%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is NetEase expected to grow at an attractive rate?
  • NetEase's earnings growth is expected to exceed the low risk savings rate of 0.2%.
Growth vs Market Checks
  • NetEase's earnings growth is expected to exceed the Germany market average.
  • NetEase's revenue growth is expected to exceed the Germany market average.
Annual Growth Rates Comparison
Raw Data
DB:NEH Future Growth Rates Data Sources
Data Point Source Value (per year)
DB:NEH Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 27 Analysts 12.1%
DB:NEH Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 27 Analysts 17%
Germany Entertainment Industry Earnings Growth Rate Market Cap Weighted Average 23%
Germany Entertainment Industry Revenue Growth Rate Market Cap Weighted Average 3.5%
Germany Market Earnings Growth Rate Market Cap Weighted Average 11.6%
Germany Market Revenue Growth Rate Market Cap Weighted Average 4.8%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
DB:NEH Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 27 Analyst Estimates (S&P Global) See Below
All numbers in CNY Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
DB:NEH Future Estimates Data
Date (Data in CNY Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2021-12-31 112,445 13,773 8,902 15
2020-12-31 99,183 12,411 7,411 27
2019-12-31 82,826 10,049 6,210 27
DB:NEH Past Financials Data
Date (Data in CNY Millions) Revenue Cash Flow Net Income *
2018-12-31 67,156 13,416 6,152
2018-09-30 61,920 11,362 5,740
2018-06-30 57,542 9,400 6,671
2018-03-31 54,634 9,763 7,537
2017-12-31 54,102 11,889 10,708
2017-09-30 51,593 13,387 13,105
2017-06-30 48,327 15,461 13,318
2017-03-31 43,904 16,427 13,066
2016-12-31 38,179 15,488 11,605
2016-09-30 33,983 13,223 10,086
2016-06-30 31,443 11,695 9,228
2016-03-31 27,058 9,245 7,931

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • NetEase's earnings are expected to grow by 12.1% yearly, however this is not considered high growth (20% yearly).
  • NetEase's revenue is expected to grow by 17% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
DB:NEH Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 27 Analyst Estimates (S&P Global) See Below

All data from NetEase Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

DB:NEH Future Estimates Data
Date (Data in CNY Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2021-12-31 71.56 112.85 39.20 9.00
2020-12-31 59.04 86.98 38.36 15.00
2019-12-31 49.22 58.79 43.12 15.00
DB:NEH Past Financials Data
Date (Data in CNY Millions) EPS *
2018-12-31 47.54
2018-09-30 44.06
2018-06-30 50.89
2018-03-31 57.29
2017-12-31 81.36
2017-09-30 99.60
2017-06-30 101.34
2017-03-31 99.56
2016-12-31 88.40
2016-09-30 76.80
2016-06-30 70.21
2016-03-31 60.30

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • NetEase is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess NetEase's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Germany market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Germany market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
NetEase has a total score of 3/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

NEH Past Performance

  How has NetEase performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare NetEase's growth in the last year to its industry (Entertainment).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • NetEase's year on year earnings growth rate has been positive over the past 5 years, however the most recent earnings are below average.
  • NetEase's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • NetEase's 1-year earnings growth is negative, it can't be compared to the DE Entertainment industry average.
Earnings and Revenue History
NetEase's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from NetEase Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

DB:NEH Past Revenue, Cash Flow and Net Income Data
Date (Data in CNY Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 67,156.45 6,152.41 12,718.01 7,792.55
2018-09-30 61,919.81 5,740.32 12,536.67 6,879.35
2018-06-30 57,542.30 6,671.48 11,602.31 5,771.53
2018-03-31 54,634.46 7,537.07 10,888.26 4,905.58
2017-12-31 54,102.02 10,707.94 9,387.45 4,371.43
2017-09-30 51,593.40 13,105.43 8,031.35 4,006.33
2017-06-30 48,327.26 13,318.00 7,453.13 3,673.64
2017-03-31 43,904.03 13,066.49 6,679.29 3,348.42
2016-12-31 38,178.84 11,604.52 5,987.97 3,046.98
2016-09-30 33,982.78 10,085.88 5,483.40 2,756.62
2016-06-30 31,442.92 9,227.77 4,954.33 2,559.89
2016-03-31 27,058.00 7,931.48 4,346.54 2,330.42
2015-12-31 22,802.90 6,735.11 3,972.62 2,158.89
2015-09-30 18,362.93 5,841.91 3,605.77 1,963.72
2015-06-30 14,807.88 5,119.16 3,130.89 1,736.64
2015-03-31 13,007.57 4,897.19 2,764.02 1,531.97
2014-12-31 11,712.83 4,756.62 2,362.67 1,323.50
2014-09-30 10,672.26 4,722.38 1,924.93 1,169.87
2014-06-30 9,912.16 4,611.53 1,639.98 1,030.77
2014-03-31 9,409.10 4,504.28 1,510.83 962.25
2013-12-31 9,196.18 4,443.91 1,443.44 921.62
2013-09-30 9,044.63 4,215.42 1,424.16 873.00
2013-06-30 8,689.95 3,979.06 1,382.14 817.32
2013-03-31 8,387.92 3,759.26 1,245.05 766.08
2012-12-31 8,200.96 3,637.45 1,192.93 718.32
2012-09-30 8,029.27 3,527.54 1,138.05 671.48
2012-06-30 7,985.20 3,541.36 1,088.79 591.49

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • NetEase has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • NetEase used its assets more efficiently than the DE Entertainment industry average last year based on Return on Assets.
  • NetEase's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess NetEase's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Entertainment industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
NetEase has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

NEH Health

 How is NetEase's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up NetEase's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • NetEase is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • NetEase's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of NetEase's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is covered by short term assets, assets are 5x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from NetEase Company Filings, last reported 3 months ago.

DB:NEH Past Debt and Equity Data
Date (Data in CNY Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 51,411.58 13,658.55 49,964.26
2018-09-30 46,238.94 13,645.93 42,436.61
2018-06-30 45,188.22 12,725.74 44,127.91
2018-03-31 45,474.73 9,516.16 43,337.67
2017-12-31 47,049.84 6,623.50 43,248.81
2017-09-30 46,284.01 5,732.59 40,679.80
2017-06-30 44,732.12 5,377.69 41,140.48
2017-03-31 42,480.23 4,483.44 40,143.10
2016-12-31 38,462.94 3,815.69 36,538.73
2016-09-30 35,246.54 3,005.01 30,859.95
2016-06-30 32,910.82 2,320.92 28,188.00
2016-03-31 31,148.35 2,261.42 27,019.77
2015-12-31 29,323.60 2,272.76 25,713.17
2015-09-30 27,243.13 2,226.46 24,309.03
2015-06-30 25,898.60 2,139.76 22,906.48
2015-03-31 24,749.47 1,228.34 23,730.27
2014-12-31 23,491.79 2,049.87 22,576.58
2014-09-30 22,290.51 2,061.09 21,420.20
2014-06-30 21,350.46 2,061.19 20,559.04
2014-03-31 20,329.49 1,784.11 19,822.30
2013-12-31 20,168.26 975.50 18,984.95
2013-09-30 18,888.58 983.68 17,727.43
2013-06-30 17,809.71 988.59 17,295.98
2013-03-31 16,683.45 1,003.02 16,299.47
2012-12-31 15,601.49 0.00 15,762.97
2012-09-30 15,811.09 0.00 14,935.88
2012-06-30 15,011.74 0.00 14,352.62
  • NetEase's level of debt (26.6%) compared to net worth is satisfactory (less than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (4.9% vs 26.6% today).
  • Debt is well covered by operating cash flow (98.2%, greater than 20% of total debt).
  • NetEase earns more interest than it pays, coverage of interest payments is not a concern.
X
Financial health checks
We assess NetEase's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. NetEase has a total score of 5/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

NEH Dividends

 What is NetEase's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0.64%
Current annual income from NetEase dividends. Estimated to be 0.82% next year.
If you bought €2,000 of NetEase shares you are expected to receive €13 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • NetEase's pays a lower dividend yield than the bottom 25% of dividend payers in Germany (1.43%).
  • NetEase's dividend is below the markets top 25% of dividend payers in Germany (3.71%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
DB:NEH Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 27 Analyst Estimates (S&P Global) See Below
Germany Entertainment Industry Average Dividend Yield Market Cap Weighted Average of 5 Stocks 1.5%
Germany Market Average Dividend Yield Market Cap Weighted Average of 327 Stocks 3%
Germany Minimum Threshold Dividend Yield 10th Percentile 0.8%
Germany Bottom 25% Dividend Yield 25th Percentile 1.4%
Germany Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

DB:NEH Future Dividends Estimate Data
Date (Data in CN¥) Dividend per Share (annual) Avg. No. Analysts
2021-12-31 17.92 12.00
2020-12-31 16.06 19.00
2019-12-31 12.27 17.00
DB:NEH Past Annualized Dividends Data
Date (Data in CN¥) Dividend per share (annual) Avg. Yield (%)
2019-02-20 11.828 0.727
2018-04-20 18.951 1.290
2018-02-07 18.859 1.022
2017-05-11 27.066 1.434
2017-04-21 27.812 1.498
2017-02-15 27.695 1.421
2016-11-09 21.144 1.333
2016-08-18 20.679 1.301
2016-05-12 19.025 1.601
2016-02-25 13.102 1.442
2015-11-11 14.263 1.388
2015-04-24 9.043 1.097
2015-02-09 8.953 1.364
2014-08-13 9.044 1.552
2014-05-14 8.368 1.766
2014-02-14 8.554 2.056

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • NetEase is not paying a notable dividend for Germany, therefore no need to check if the payments are stable.
  • NetEase is not paying a notable dividend for Germany, therefore no need to check if the payments are increasing.
Current Payout to shareholders
What portion of NetEase's earnings are paid to the shareholders as a dividend.
  • No need to calculate the sustainability of NetEase's dividends as it is not paying a notable one for Germany.
Future Payout to shareholders
  • No need to calculate the sustainability of NetEase's dividends in 3 years as they are not expected to pay a notable one for Germany.
X
Income/ dividend checks
We assess NetEase's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can NetEase afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. NetEase has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

NEH Management

 What is the CEO of NetEase's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
William Ding
COMPENSATION CN¥0
AGE 46
TENURE AS CEO 13.4 years
CEO Bio

Mr. Lei Ding, also known as William, founded NetEase, Inc. and has been its Chief Executive Officer since November 2005. Mr. Ding founded NetEase Capital in April 2012. Mr. Ding established NetEase and Guangzhou Netease in May 1997 and has been a major force in the development of the Internet in China. He served as the Chief Architect of NetEase.com, Inc. from March 2001 to November 2005. Mr. Ding served as Acting Chief Executive Officer and Chief Operating Officer of Netease Com Inc. from June 2001 to September 2001. He served as the Co-Chief Technology Officer from July 1999 to March 2001 and Interim Chief Executive Officer of NetEase.com, Inc. from July 1999 to April 2000. During NetEase's initial two years of operation, he focused on Internet application systems. In November 1997, he introduced China's first dual language free email service to users, which was a decisive factor in the prevalence and growth of China's Internet industry. He has accumulated rich and varied experience in his professional life in the Internet world. Mr. Ding spent one year at Guangzhou Feijie Co. as a systems analyst, from June 1996 to April 1997, one year at Sybase (China) as a project manager/technical support engineer from May 1995 to May 1996 and two years at China Telecom Ningbo Branch as a technical engineer from June 1993 to May 1995. He served as the Chairman of the Board of Directors at NetEase.com, Inc. until September 2001. Mr. Ding has been a Director of NetEase, Inc. since July 1999. Mr. Ding holds a Bachelor of Science degree in Communication Technology from the University of Electronic Science and Technology of China.

CEO Compensation
  • Insufficient data for William to compare compensation growth.
  • Insufficient data for William to establish whether their remuneration is reasonable compared to companies of similar size in Germany.
Management Team Tenure

Average tenure of the NetEase management team in years:

11.7
Average Tenure
  • The average tenure for the NetEase management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

William Ding

TITLE
Founder
AGE
46
TENURE
13.4 yrs

Onward Choi

TITLE
Consultant
AGE
47

Charles Yang

TITLE
Chief Financial Officer
TENURE
1.8 yrs

Margaret Shi

TITLE
IR Director

Feng Zhou

TITLE
Senior Vice President of Search Operations
TENURE
11.7 yrs
Board of Directors Tenure

Average tenure and age of the NetEase board of directors in years:

16.8
Average Tenure
55
Average Age
  • The average tenure for the NetEase board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Board of Directors

Michael Leung

TITLE
Director
COMPENSATION
CN¥54K
AGE
64
TENURE
16.8 yrs

William Ding

TITLE
Founder
AGE
46
TENURE
19.8 yrs

Denny Lee

TITLE
Director
COMPENSATION
CN¥12K
AGE
51
TENURE
17 yrs

Michael Tong

TITLE
Director
AGE
47
TENURE
19.3 yrs

Joseph Tong

TITLE
Director
COMPENSATION
CN¥54K
AGE
55
TENURE
16.1 yrs

Lun Feng

TITLE
Director
COMPENSATION
CN¥14K
AGE
59
TENURE
13.8 yrs

Alice Cheng

TITLE
Independent Non-Executive Director
COMPENSATION
CN¥67K
AGE
57
TENURE
11.8 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (€) Value (€)
X
Management checks
We assess NetEase's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. NetEase has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

NEH News

Simply Wall St News

NEH Company Info

Description

NetEase, Inc. operates an interactive online community in the People’s Republic of China. The company operates through Online Game Services; E-Commerce; Advertising Services; and Email and Others segments. It offers various games in a range of genres through mobile devices and PCs, including role playing games, MMORPGs, battle arena games, simulation games, collectible card games, first-person shooter games, sandbox games, and other types of games to the Chinese market. The company also operates Kaola that sells imported maternity and baby products, skincare and cosmetics, and other general merchandise; and Yanxuan, which sells its private label products, including apparel, homeware, kitchenware, and other general merchandise, as well as NetEase News App and NetEase Websites, which provide Internet users with Chinese language-based online services that are centered around content and interactive community. In addition, it provides online advertising services comprising banner advertising, channel sponsorships, direct email, interactive media-rich sites, sponsored special events, games, contests, and other activities; and email services to individual and corporate users. Further, NetEase, Inc. offers online services, such as CC, a live video streaming platform; Cloud Music, a music streaming platform; Wangyibao, a payment platform; EaseRead, an e-reading platform; NetEase Cloud Classroom, an online education platform; and Youdao Dictionary, an e-dictionary services platform. It has a collaboration agreement with Blizzard Entertainment, Inc. to co-develop a game in the storied Diablo franchise. The company was formerly known as NetEase.com, Inc. and changed its name to NetEase, Inc. in March 2012. NetEase, Inc. was founded in 1997 and is based in Beijing, the People’s Republic of China.

Details
Name: NetEase, Inc.
NEH
Exchange: DB
Founded: 1997
$31,413,679,574
131,328,698
Website: http://ir.netease.com
Address: NetEase, Inc.
Building No. 7, West Zone,
Zhongguancun Software Park (Phase II),
Beijing,
100193,
China
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NasdaqGS NTES ADR EACH REPR 25 COM STK USD0.0001 Nasdaq Global Select US USD 30. Jun 2000
DB NEH ADR EACH REPR 25 COM STK USD0.0001 Deutsche Boerse AG DE EUR 30. Jun 2000
LSE 0K6G ADR EACH REPR 25 COM STK USD0.0001 London Stock Exchange GB USD 30. Jun 2000
SWX NTES ADR EACH REPR 25 COM STK USD0.0001 SIX Swiss Exchange CH CHF 30. Jun 2000
WBAG NTES ADR EACH REPR 25 COM STK USD0.0001 Wiener Boerse AG AT EUR 30. Jun 2000
BMV NTES N ADR EACH REPR 25 COM STK USD0.0001 Bolsa Mexicana de Valores MX MXN 30. Jun 2000
Number of employees
Current staff
Staff numbers
18,946
NetEase employees.
Industry
Interactive Home Entertainment
Media
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/04/23 21:35
End of day share price update: 2019/04/23 00:00
Last estimates confirmation: 2019/04/22
Last earnings filing: 2019/02/20
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.