Finance
NetEase: Multiples Will Rise As International Business Expands
NetEase (NTES) is expanding its international business, with overseas revenue now accounting for 10.1% of its total, driven by titles like Marvel Rivals
NetEase (NTES) is expanding its international business, with overseas revenue now accounting for 10.1% of its total, driven by titles like Marvel Rivals and Where Winds Meet. Financial analysis indicates the company is undervalued, trading at 10x free cash flow with a 38% free cash flow margin and $25.3B in cash. While regulatory risk in China remains a primary concern, growing international revenues are expected to help narrow its valuation discount and support a target price of $150 per share.
By the numbers
- 10x
- Price-to-free cash flow trading multiple
- 24%
- Upside potential to target share price
- $150
- Target share price for NetEase
- 10.1%
- Overseas revenue share of NetEase
- 38%
- Free cash flow margin of NetEase
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