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Market Cap

US$71.8b

Last Updated

2021/04/10 22:09 UTC

Data Sources

Company Financials +

Executive Summary

NetEase, Inc., an Internet technology company, provides online services focusing on content, community, communication, and commerce in the Peoples’ Republic of China and internationally. More Details


Snowflake Analysis

Excellent balance sheet with questionable track record.


Similar Companies

Share Price & News

How has NetEase's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NTES is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: NTES's weekly volatility (7%) has been stable over the past year.


Market Performance


7 Day Return

-2.5%

NTES

1.7%

US Entertainment

1.6%

US Market


1 Year Return

58.8%

NTES

86.7%

US Entertainment

55.3%

US Market

Return vs Industry: NTES underperformed the US Entertainment industry which returned 86.7% over the past year.

Return vs Market: NTES exceeded the US Market which returned 55.3% over the past year.


Shareholder returns

NTESIndustryMarket
7 Day-2.5%1.7%1.6%
30 Day-4.1%0.03%4.1%
90 Day-9.3%2.5%5.5%
1 Year60.1%58.8%86.9%86.7%58.1%55.3%
3 Year97.6%90.4%109.1%106.1%63.8%53.3%
5 Year299.8%275.8%172.5%161.4%120.2%95.7%

Long-Term Price Volatility Vs. Market

How volatile is NetEase's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is NetEase undervalued compared to its fair value and its price relative to the market?

37.33x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NTES ($104.93) is trading above our estimate of fair value ($70.96)

Significantly Below Fair Value: NTES is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NTES is good value based on its PE Ratio (37.7x) compared to the US Entertainment industry average (38.1x).

PE vs Market: NTES is poor value based on its PE Ratio (37.7x) compared to the US market (22.3x).


Price to Earnings Growth Ratio

PEG Ratio: NTES is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: NTES is overvalued based on its PB Ratio (5.6x) compared to the US Entertainment industry average (5x).


Future Growth

How is NetEase forecast to perform in the next 1 to 3 years based on estimates from 34 analysts?

15.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NTES's forecast earnings growth (15.5% per year) is above the savings rate (2%).

Earnings vs Market: NTES's earnings (15.5% per year) are forecast to grow slower than the US market (18.7% per year).

High Growth Earnings: NTES's earnings are forecast to grow, but not significantly.

Revenue vs Market: NTES's revenue (13.3% per year) is forecast to grow faster than the US market (9.9% per year).

High Growth Revenue: NTES's revenue (13.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NTES's Return on Equity is forecast to be low in 3 years time (19.2%).


Past Performance

How has NetEase performed over the past 5 years?

8.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NTES has high quality earnings.

Growing Profit Margin: NTES's current net profit margins (16.4%) are lower than last year (22.4%).


Past Earnings Growth Analysis

Earnings Trend: NTES's earnings have grown by 8.3% per year over the past 5 years.

Accelerating Growth: NTES's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NTES had negative earnings growth (-9.2%) over the past year, making it difficult to compare to the Entertainment industry average (52.6%).


Return on Equity

High ROE: NTES's Return on Equity (13.1%) is considered low.


Financial Health

How is NetEase's financial position?


Financial Position Analysis

Short Term Liabilities: NTES's short term assets (CN¥107.8B) exceed its short term liabilities (CN¥46.7B).

Long Term Liabilities: NTES's short term assets (CN¥107.8B) exceed its long term liabilities (CN¥1.3B).


Debt to Equity History and Analysis

Debt Level: NTES's debt to equity ratio (20.2%) is considered satisfactory.

Reducing Debt: NTES's debt to equity ratio has increased from 7.7% to 20.2% over the past 5 years.

Debt Coverage: NTES's debt is well covered by operating cash flow (131.1%).

Interest Coverage: NTES earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Dividend

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

0.74%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: NTES's dividend (0.74%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.27%).

High Dividend: NTES's dividend (0.74%) is low compared to the top 25% of dividend payers in the US market (3.5%).


Stability and Growth of Payments

Stable Dividend: NTES has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: NTES's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (4.3%), NTES's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NTES's dividends in 3 years are forecast to be well covered by earnings (21.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

13.7yrs

Average management tenure


CEO

William Ding (48 yo)

15.42yrs

Tenure

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 is a Director of Youdao, In...


Leadership Team

Experienced Management: NTES's management team is seasoned and experienced (13.7 years average tenure).


Board Members

Experienced Board: NTES's board of directors are seasoned and experienced ( 18.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 8%.


Top Shareholders

Company Information

NetEase, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: NetEase, Inc.
  • Ticker: NTES
  • Exchange: NasdaqGS
  • Founded: 1997
  • Industry: Interactive Home Entertainment
  • Sector: Media
  • Market Cap: US$71.825b
  • Shares outstanding: 691.02m
  • Website: https://ir.netease.com

Number of Employees


Location

  • NetEase, Inc.
  • NetEase Building
  • No. 599 Wangshang Road
  • Hangzhou
  • Zhejiang Province
  • 310052
  • China

Listings


Biography

NetEase, Inc., an Internet technology company, provides online services focusing on content, community, communication, and commerce in the Peoples’ Republic of China and internationally. The company operat...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/04/10 22:09
End of Day Share Price2021/04/09 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.