JP Morgan Stanley: Raises Tencent Holdings Limited's target price to HKD 520, raises adjusted earnings per share forecast for this year and next year

Zhitong
2024.10.14 07:24

JP Morgan released a report stating that Tencent's earnings are driven more by non-cyclical operations. However, they believe that Tencent's non-cyclical operations will continue to deliver positive alpha, especially in the gaming business. Tencent's cyclical operations are also expected to benefit from consumption recovery in the coming quarters, similar to e-commerce platforms. The bank predicts that Tencent's online game revenue will increase by 15% and 27% year-on-year in the third and fourth quarters, compared to a 9% increase in the second quarter, benefiting from a low base, strong performance of existing games, and contributions from new game revenue. In addition, the bank has raised its adjusted earnings per share forecast for the current and next year by 3% and 6% respectively, raised the target price from HKD 480 to HKD 520, and maintained a "overweight" rating

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