Financials NetEase, Inc. Hong Kong S.E.

Equities

9999

KYG6427A1022

Internet Services

Market Closed - Hong Kong S.E. Other stock markets 09:08:20 26/04/2024 BST			5-day change	1st Jan Change
149.2 ^HKD	+1.77%		+4.48%	+6.12%

04-12	Correction to Blizzard Videogames Article on April 9	DJ
04-12	Morgan Stanley Lowers Price Target on NetEase to $120 From $135, Keeps Overweight Rating	MT

Valuation

Fiscal Period: December	2019	2020	2021	2022	2023	2024	2025	2026
Capitalization ¹	273,162	431,820	420,541	310,721	413,519	448,298	-	-
Enterprise Value (EV) ¹	214,794	357,855	353,039	247,963	310,902	319,964	299,424	270,930
P/E ratio	13.1 x	34.7 x	25.8 x	16.2 x	14.6 x	14.5 x	13.1 x	11.1 x
Yield	2.28%	0.81%	1.2%	1.91%	2.79%	2.42%	2.69%	2.91%
Capitalization / Revenue	4.61 x	5.86 x	4.8 x	3.22 x	4 x	3.92 x	3.58 x	3.32 x
EV / Revenue	3.63 x	4.86 x	4.03 x	2.57 x	3 x	2.8 x	2.39 x	2 x
EV / EBITDA	13.1 x	19.9 x	17.9 x	11 x	10.1 x	9.2 x	7.55 x	6.15 x
EV / FCF	13.4 x	15 x	16.2 x	9.89 x	9.41 x	9 x	8.04 x	6.47 x
FCF Yield	7.45%	6.66%	6.18%	10.1%	10.6%	11.1%	12.4%	15.5%
Price to Book	4.47 x	5.03 x	4.51 x	3.12 x	3.42 x	3.11 x	2.7 x	2.31 x
Nbr of stocks (in thousands)	639,804	691,023	650,472	620,272	625,422	644,494	-	-
Reference price ²	426.9	624.9	646.5	500.9	661.2	695.6	695.6	695.6
Announcement Date	26/02/20	25/02/21	24/02/22	23/02/23	29/02/24	-	-	-

¹CNY in Million²CNY

Estimates

Income Statement Evolution (Annual data)

Fiscal Period: December	2019	2020	2021	2022	2023	2024	2025	2026
Net sales ¹	59,241	73,667	87,606	96,496	103,468	114,315	125,245	135,209
EBITDA ¹	16,404	17,996	19,693	22,487	30,764	34,761	39,654	44,061
EBIT ¹	13,791	14,538	16,417	19,629	27,709	32,241	36,436	40,773
Operating Margin	23.28%	19.74%	18.74%	20.34%	26.78%	28.2%	29.09%	30.16%
Earnings before Tax (EBT) ¹	25,533	15,372	21,104	24,250	34,057	37,353	41,547	46,172
Net income ¹	21,238	12,063	16,857	20,338	29,417	31,093	34,199	37,789
Net margin	35.85%	16.37%	19.24%	21.08%	28.43%	27.2%	27.31%	27.95%
EPS ²	32.67	18.01	25.03	30.85	45.23	47.84	53.26	62.52
Free Cash Flow ¹	16,007	23,833	21,817	25,066	33,030	35,555	37,245	41,869
FCF margin	27.02%	32.35%	24.9%	25.98%	31.92%	31.1%	29.74%	30.97%
FCF Conversion (EBITDA)	97.58%	132.43%	110.79%	111.47%	107.36%	102.28%	93.92%	95.03%
FCF Conversion (Net income)	75.37%	197.57%	129.42%	123.25%	112.28%	114.35%	108.91%	110.8%
Dividend per Share ²	9.751	5.060	7.785	9.581	18.44	16.81	18.73	20.22
Announcement Date	26/02/20	25/02/21	24/02/22	23/02/23	29/02/24	-	-	-

¹CNY in Million²CNY

Estimates

Income Statement Evolution (Quarterly data)

Fiscal Period: December	2021 Q3	2021 Q4	2022 Q1	2022 Q2	2022 Q3	2022 Q4	2023 Q1	2023 Q2	2023 Q3	2023 Q4	2024 Q1	2024 Q2	2024 Q3	2024 Q4	2025 Q1
Net sales ¹	22,191	24,374	23,556	23,159	24,427	25,354	25,046	24,011	27,270	27,140	26,834	26,790	29,769	30,082	35,143
EBITDA ¹	4,581	5,444	6,273	5,555	5,456	5,203	8,302	6,724	8,210	7,528	7,002	6,088	7,458	8,139	-
EBIT ¹	3,775	4,608	5,507	4,946	4,742	4,433	7,220	6,063	7,558	6,868	8,067	7,711	8,491	8,295	-
Operating Margin	17.01%	18.91%	23.38%	21.36%	19.41%	17.49%	28.83%	25.25%	27.71%	25.31%	30.06%	28.78%	28.52%	27.58%	-
Earnings before Tax (EBT) ¹	4,131	6,597	5,535	5,731	8,208	4,776	8,339	8,872	9,101	7,745	8,991	8,587	9,503	9,394	-
Net income ¹	3,182	5,694	4,394	5,291	6,699	3,953	6,755	8,243	7,837	6,582	7,500	7,230	7,946	7,686	-
Net margin	14.34%	23.36%	18.65%	22.85%	27.43%	15.59%	26.97%	34.33%	28.74%	24.25%	27.95%	26.99%	26.69%	25.55%	-
EPS ²	4.730	8.570	6.630	8.000	10.17	6.050	10.37	12.69	12.06	10.12	12.14	11.43	13.34	13.82	-
Dividend per Share ²	1.438	2.563	2.142	2.443	3.113	1.865	3.290	3.820	3.585	7.764	3.941	3.789	4.016	4.105	4.602
Announcement Date	16/11/21	24/02/22	24/05/22	18/08/22	17/11/22	23/02/23	25/05/23	24/08/23	16/11/23	29/02/24	-	-	-	-	-

¹CNY in Million²CNY

Estimates

Balance Sheet Analysis

Fiscal Period: December	2019	2020	2021	2022	2023	2024	2025	2026
Net Debt ¹	-	-	-	-	-	-	-	-
Net Cash position ¹	58,368	73,965	67,502	62,758	102,617	128,334	148,874	177,368
Leverage (Debt/EBITDA)	-	-	-	-	-	-	-	-
Free Cash Flow ¹	16,007	23,833	21,817	25,066	33,030	35,555	37,245	41,869
ROE (net income / shareholders' equity)	29.4%	20.5%	19%	20.3%	25.7%	23.9%	22.2%	21%
ROA (Net income/ Total Assets)	15.7%	11.6%	11.4%	12.5%	16.4%	16.2%	15.4%	15.1%
Assets ¹	134,978	104,172	147,759	163,203	179,343	191,531	222,498	250,375
Book Value Per Share ²	95.40	124.0	143.0	160.0	193.0	224.0	258.0	301.0
Cash Flow per Share ²	26.50	37.10	7.400	42.00	54.30	71.50	67.30	67.40
Capex ¹	1,209	1,056	3,038	2,602	4,266	3,104	3,402	3,247
Capex / Sales	2.04%	1.43%	3.47%	2.7%	4.12%	2.72%	2.72%	2.4%
Announcement Date	26/02/20	25/02/21	24/02/22	23/02/23	29/02/24	-	-	-

¹CNY in Million²CNY

Estimates

EPS & Dividend

Year-on-year evolution of the PER

Year-on-year evolution of the Yield

Change in Enterprise Value/EBITDA

Ratings for NetEase, Inc.

Trading Rating

Investor Rating

ESG Refinitiv

More Ratings

Analysts' Consensus

Sell

Buy

Mean consensus

BUY

Number of Analysts

Last Close Price

695.6 CNY

Average target price

962.7 CNY

Spread / Average Target

+38.40%

Consensus

EPS Revisions

Estimates Revisions

Quarterly earnings - Rate of surprise

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