For those who appreciate value investing, NASDAQ:NTES is a compelling option with its solid fundamentals.

NETEASE INC-ADR (NASDAQ:NTES) has caught the attention of our stock screener as a great value stock. NASDAQ:NTES excels in profitability, solvency, and liquidity, all while being very reasonably priced. Let's delve into the details.

Valuation Assessment of NASDAQ:NTES

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:NTES was assigned a score of 8 for valuation:

• Based on the Price/Earnings ratio, NTES is valued cheaply inside the industry as 88.00% of the companies are valued more expensively.
• NTES is valuated rather cheaply when we compare the Price/Earnings ratio to 26.11, which is the current average of the S&P500 Index.
• 85.33% of the companies in the same industry are more expensive than NTES, based on the Price/Forward Earnings ratio.
• When comparing the Price/Forward Earnings ratio of NTES to the average of the S&P500 Index (21.02), we can say NTES is valued slightly cheaper.
• 78.67% of the companies in the same industry are more expensive than NTES, based on the Enterprise Value to EBITDA ratio.
• Compared to the rest of the industry, the Price/Free Cash Flow ratio of NTES indicates a rather cheap valuation: NTES is cheaper than 85.33% of the companies listed in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• NTES has an outstanding profitability rating, which may justify a higher PE ratio.
• NTES's earnings are expected to grow with 18.85% in the coming years. This may justify a more expensive valuation.

What does the Profitability looks like for NASDAQ:NTES

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:NTES, the assigned 8 is a significant indicator of profitability:

• The Return On Assets of NTES (15.61%) is better than 98.67% of its industry peers.
• The Return On Equity of NTES (22.33%) is better than 92.00% of its industry peers.
• NTES has a better Return On Invested Capital (14.53%) than 94.67% of its industry peers.
• The last Return On Invested Capital (14.53%) for NTES is above the 3 year average (10.68%), which is a sign of increasing profitability.
• NTES's Profit Margin of 26.35% is amongst the best of the industry. NTES outperforms 98.67% of its industry peers.
• NTES has a better Operating Margin (24.86%) than 98.67% of its industry peers.
• Looking at the Gross Margin, with a value of 58.50%, NTES is in the better half of the industry, outperforming 76.00% of the companies in the same industry.

Health Insights: NASDAQ:NTES

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:NTES has earned a 7 out of 10:

• The Debt to FCF ratio of NTES is 0.41, which is an excellent value as it means it would take NTES, only 0.41 years of fcf income to pay off all of its debts.
• NTES has a better Debt to FCF ratio (0.41) than 94.67% of its industry peers.
• A Debt/Equity ratio of 0.10 indicates that NTES is not too dependend on debt financing.
• With a decent Debt to Equity ratio value of 0.10, NTES is doing good in the industry, outperforming 73.33% of the companies in the same industry.
• A Current Ratio of 2.91 indicates that NTES has no problem at all paying its short term obligations.
• NTES has a better Current ratio (2.91) than 81.33% of its industry peers.
• A Quick Ratio of 2.89 indicates that NTES has no problem at all paying its short term obligations.
• The Quick ratio of NTES (2.89) is better than 81.33% of its industry peers.

Growth Insights: NASDAQ:NTES

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:NTES has achieved a 6 out of 10:

• The Earnings Per Share has grown by an impressive 24.56% over the past year.
• Measured over the past years, NTES shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.47% on average per year.
• NTES shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 16.78% yearly.
• NTES is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.51% yearly.
• Based on estimates for the next years, NTES will show a quite strong growth in Revenue. The Revenue will grow by 10.78% on average per year.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

Check the latest full fundamental report of NTES for a complete fundamental analysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.