China Stock Ideas

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NetEase - >>> 19 of the Best Stocks You've Never Heard Of


Kiplinger

by Jeff Reeves

6-23-20


https://www.kiplinger.com/slideshow/investing/t052-s001-19-of-the-best-stocks-youve-never-heard-of/index.html


NetEase


Sector: Information technology
Market value: $53.3 billion
Dividend yield: 1.1%


NetEase (NTES, $409.30) is a video game studio that primarily serves the lucrative and fast-growing marketplace in China. In addition to highly successful in-house titles such as Fantasy Westward Journey, NTES also is the local partner of big Western studios like Activision Blizzard (ATVI) to service hits such as Overwatch that are more familiar to U.S. audiences.

The outlook for video game spending is always quite strong, as the sector always experiences year-over-year growth like clockwork. But the coronavirus pandemic has really accelerated spending among gamers in 2020.

Longer-term, investors are also quite bullish on NTES; Goldman Sachs recently upgraded the stock because of growth in its other education and music segments, creating a more diversified revenue stream, and maintained its Buy rating on expectations of "steady execution and good cash flows from its game biz."

All told, seven Buys versus just one Hold over the past three months puts NTES among some of the best stocks that don't make the average investor's radar.

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