Tencent Stock – Tencent Holdings Set to Announce Q3 Results: What Investors Should Know

Tencent Stock – Hong Kong-listed Tencent Holdings Limited (HK:0700) is gaining favorable support from analysts, driven by a solid outlook for its gaming revenue growth. Recently, analysts from CMB International and CGS-CIMB reiterated their Buy ratings on the stock, predicting an upside of over 25%.

Tencent Holdings is a leading technology company that delivers digital entertainment and internet value-added services to over one billion users globally.

CGS-CIMB Maintains Optimistic Forecast

Analyst Lei Yang from CGS-CIMB is optimistic about Tencent’s gaming division, forecasting a 13% year-over-year growth in game revenue for the third quarter of 2024, compared to 9% in the previous quarter. This expected growth is largely attributed to the launch of the new mobile game, Dungeon & Fighter (DnF).

Yang highlighted that Tencent’s flagship games, such as Game for Peace and Honor of Kings, are anticipated to drive robust revenue growth in both domestic and international markets. Furthermore, Yang is confident in Tencent’s profit margins as the company shifts toward higher-margin revenue streams and optimizes operational costs. He projects a 14% year-over-year increase in gross profit for Q3.

Overall, CGS-CIMB estimates that Tencent’s Q3 revenue will grow by 7.6% year-over-year, with a 14.9% increase in non-GAAP net profit.

CMB International Affirms Positive Outlook

Similarly, Saiyi He from CMB International Securities expresses a bullish stance on Tencent’s gaming division. He noted that the company’s new and existing mobile games have demonstrated strong performance and high user engagement. Since its launch in May, DnF Mobile has consistently ranked among the top five grossing iOS games in China. Additionally, high-margin segments such as Video Accounts and Mini Games are expected to further drive earnings growth.

CMB anticipates a 13% year-over-year growth in gaming revenue, projecting it to reach ¥51.8 billion in Q3.

Upcoming Earnings Announcement

Tencent is scheduled to announce its third-quarter results for 2024 on November 13.

Is Tencent a Good Stock to Buy Now?

According to TipRanks’ rating consensus, Tencent (0700) has received a Strong Buy rating, supported by 13 Buy recommendations and one Hold recommendation. The projected share price for Tencent is HK$515.98, implying a potential upside of 24.09% from its current trading level.

Year-to-date, Tencent stock has seen a significant growth of 39.1%, making it a noteworthy consideration for investors looking to capitalize on the company’s strong gaming performance and market position.

In summary, with a favorable outlook from analysts and a promising gaming revenue growth trajectory, Tencent Holdings continues to attract attention as a compelling investment opportunity.

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