NETEASE INC-ADR (NTES) Stock Fundamental Analysis
USA - NASDAQ:NTES - US64110W1027 - ADR
133.93 USD
-0.02 (-0.01%)
We assign a fundamental rating of 7 out of 10 to NTES. NTES was compared to 79 industry peers in the Entertainment industry. NTES gets an excellent profitability rating and is at the same time showing great financial health properties. NTES may be a bit undervalued, certainly considering the very reasonable score on growth These ratings would make NTES suitable for value and quality investing!
1. Profitability
1.1 Basic Checks
In the past year NTES was profitable.
NTES had a positive operating cash flow in the past year.
Each year in the past 5 years NTES has been profitable.
NTES had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NTES has a better Return On Assets (16.41%) than 92.41% of its industry peers.
NTES's Return On Equity of 22.87% is amongst the best of the industry. NTES outperforms 88.61% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.40%, NTES belongs to the top of the industry, outperforming 93.67% of the companies in the same industry.
NTES had an Average Return On Invested Capital over the past 3 years of 14.54%. This is above the industry average of 9.82%.
The 3 year average ROIC (14.54%) for NTES is below the current ROIC(17.40%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.41% | ||
| ROE | 22.87% | ||
| ROIC | 17.4% |
ROA(3y)14.25%
ROA(5y)12.44%
ROE(3y)21.5%
ROE(5y)19.37%
ROIC(3y)14.54%
ROIC(5y)13.18%
1.3 Margins
NTES has a Profit Margin of 31.19%. This is amongst the best in the industry. NTES outperforms 97.47% of its industry peers.
In the last couple of years the Profit Margin of NTES has declined.
Looking at the Operating Margin, with a value of 31.43%, NTES belongs to the top of the industry, outperforming 98.73% of the companies in the same industry.
NTES's Operating Margin has improved in the last couple of years.
NTES has a better Gross Margin (63.17%) than 70.89% of its industry peers.
NTES's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 31.43% | ||
| PM (TTM) | 31.19% | ||
| GM | 63.17% |
OM growth 3Y14.45%
OM growth 5Y3.83%
PM growth 3Y13.59%
PM growth 5Y-4.68%
GM growth 3Y5.24%
GM growth 5Y3.25%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so NTES is creating value.
Compared to 1 year ago, NTES has less shares outstanding
NTES has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, NTES has an improved debt to assets ratio.
2.2 Solvency
The Debt to FCF ratio of NTES is 0.25, which is an excellent value as it means it would take NTES, only 0.25 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 0.25, NTES belongs to the best of the industry, outperforming 88.61% of the companies in the same industry.
A Debt/Equity ratio of 0.08 indicates that NTES is not too dependend on debt financing.
NTES has a Debt to Equity ratio of 0.08. This is in the better half of the industry: NTES outperforms 60.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.25 | ||
| Altman-Z | N/A |
ROIC/WACC2.57
WACC6.77%
2.3 Liquidity
A Current Ratio of 3.23 indicates that NTES has no problem at all paying its short term obligations.
NTES has a Current ratio of 3.23. This is amongst the best in the industry. NTES outperforms 89.87% of its industry peers.
A Quick Ratio of 3.22 indicates that NTES has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 3.22, NTES belongs to the top of the industry, outperforming 89.87% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.23 | ||
| Quick Ratio | 3.22 |
3. Growth
3.1 Past
NTES shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 29.10%, which is quite impressive.
NTES shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.51% yearly.
Looking at the last year, NTES shows a small growth in Revenue. The Revenue has grown by 1.77% in the last year.
NTES shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.19% yearly.
EPS 1Y (TTM)29.1%
EPS 3Y21.03%
EPS 5Y17.51%
EPS Q2Q%26.64%
Revenue 1Y (TTM)1.77%
Revenue growth 3Y6.32%
Revenue growth 5Y12.19%
Sales Q2Q%8.14%
3.2 Future
NTES is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -26.15% yearly.
NTES is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.66% yearly.
EPS Next Y21.69%
EPS Next 2Y13.82%
EPS Next 3Y12.78%
EPS Next 5Y-26.15%
Revenue Next Year8.55%
Revenue Next 2Y8.14%
Revenue Next 3Y8.42%
Revenue Next 5Y9.66%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.34 indicates a correct valuation of NTES.
Based on the Price/Earnings ratio, NTES is valued cheaply inside the industry as 84.81% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 25.07. NTES is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 14.18, NTES is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NTES indicates a rather cheap valuation: NTES is cheaper than 87.34% of the companies listed in the same industry.
NTES is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.34 | ||
| Fwd PE | 14.18 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NTES indicates a somewhat cheap valuation: NTES is cheaper than 75.95% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, NTES is valued cheaper than 87.34% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.87 | ||
| EV/EBITDA | 10.25 |
4.3 Compensation for Growth
NTES's 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.
A more expensive valuation may be justified as NTES's earnings are expected to grow with 12.78% in the coming years.
PEG (NY)0.71
PEG (5Y)0.88
EPS Next 2Y13.82%
EPS Next 3Y12.78%
5. Dividend
5.1 Amount
NTES has a Yearly Dividend Yield of 2.17%. Purely for dividend investing, there may be better candidates out there.
NTES's Dividend Yield is rather good when compared to the industry average which is at 41.65. NTES pays more dividend than 91.14% of the companies in the same industry.
NTES's Dividend Yield is comparable with the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.17% |
5.2 History
The dividend of NTES has a limited annual growth rate of 4.94%.
NTES has paid a dividend for at least 10 years, which is a reliable track record.
NTES has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)4.94%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
36.90% of the earnings are spent on dividend by NTES. This is a low number and sustainable payout ratio.
DP36.9%
EPS Next 2Y13.82%
EPS Next 3Y12.78%
NASDAQ:NTES (11/21/2025, 10:03:02 AM)
133.93
-0.02 (-0.01%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners9.59%
Inst Owner Change7.79%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap86.32B
Revenue(TTM)105.30B
Net Income(TTM)34.21B
Analysts83.89
Price Target164.55 (22.86%)
Short Float %1.66%
Short Ratio3.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.17% |
Yearly Dividend2.45
Dividend Growth(5Y)4.94%
DP36.9%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)10.07%
Min EPS beat(2)-2.68%
Max EPS beat(2)22.83%
EPS beat(4)2
Avg EPS beat(4)6.87%
Min EPS beat(4)-8.86%
Max EPS beat(4)22.83%
EPS beat(8)4
Avg EPS beat(8)4.89%
EPS beat(12)7
Avg EPS beat(12)13.23%
EPS beat(16)10
Avg EPS beat(16)14.05%
Revenue beat(2)0
Avg Revenue beat(2)-2.35%
Min Revenue beat(2)-3.91%
Max Revenue beat(2)-0.78%
Revenue beat(4)0
Avg Revenue beat(4)-3.07%
Min Revenue beat(4)-4.07%
Max Revenue beat(4)-0.78%
Revenue beat(8)0
Avg Revenue beat(8)-3.46%
Revenue beat(12)0
Avg Revenue beat(12)-3.33%
Revenue beat(16)2
Avg Revenue beat(16)-2.21%
PT rev (1m)3.38%
PT rev (3m)10.86%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.23%
EPS NY rev (1m)0.08%
EPS NY rev (3m)0.89%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)1.18%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.34 | ||
| Fwd PE | 14.18 | ||
| P/S | 5.6 | ||
| P/FCF | 13.87 | ||
| P/OCF | 13.19 | ||
| P/B | 4.1 | ||
| P/tB | 4.1 | ||
| EV/EBITDA | 10.25 |
EPS(TTM)8.73
EY6.52%
EPS(NY)9.45
Fwd EY7.05%
FCF(TTM)9.66
FCFY7.21%
OCF(TTM)10.15
OCFY7.58%
SpS23.92
BVpS32.63
TBVpS32.63
PEG (NY)0.71
PEG (5Y)0.88
Graham Number80.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.41% | ||
| ROE | 22.87% | ||
| ROCE | 21.81% | ||
| ROIC | 17.4% | ||
| ROICexc | 130.14% | ||
| ROICexgc | 130.14% | ||
| OM | 31.43% | ||
| PM (TTM) | 31.19% | ||
| GM | 63.17% | ||
| FCFM | 40.36% |
ROA(3y)14.25%
ROA(5y)12.44%
ROE(3y)21.5%
ROE(5y)19.37%
ROIC(3y)14.54%
ROIC(5y)13.18%
ROICexc(3y)98.11%
ROICexc(5y)81.85%
ROICexgc(3y)117.55%
ROICexgc(5y)98.29%
ROCE(3y)19.38%
ROCE(5y)17.87%
ROICexgc growth 3Y31.39%
ROICexgc growth 5Y13.28%
ROICexc growth 3Y29.84%
ROICexc growth 5Y14.27%
OM growth 3Y14.45%
OM growth 5Y3.83%
PM growth 3Y13.59%
PM growth 5Y-4.68%
GM growth 3Y5.24%
GM growth 5Y3.25%
F-Score8
Asset Turnover0.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.25 | ||
| Debt/EBITDA | 0.31 | ||
| Cap/Depr | 107.66% | ||
| Cap/Sales | 2.09% | ||
| Interest Coverage | 97.92 | ||
| Cash Conversion | 127.21% | ||
| Profit Quality | 129.41% | ||
| Current Ratio | 3.23 | ||
| Quick Ratio | 3.22 | ||
| Altman-Z | N/A |
F-Score8
WACC6.77%
ROIC/WACC2.57
Cap/Depr(3y)107.89%
Cap/Depr(5y)102.75%
Cap/Sales(3y)2.99%
Cap/Sales(5y)3.4%
Profit Quality(3y)118.33%
Profit Quality(5y)132.69%
High Growth Momentum
Growth
EPS 1Y (TTM)29.1%
EPS 3Y21.03%
EPS 5Y17.51%
EPS Q2Q%26.64%
EPS Next Y21.69%
EPS Next 2Y13.82%
EPS Next 3Y12.78%
EPS Next 5Y-26.15%
Revenue 1Y (TTM)1.77%
Revenue growth 3Y6.32%
Revenue growth 5Y12.19%
Sales Q2Q%8.14%
Revenue Next Year8.55%
Revenue Next 2Y8.14%
Revenue Next 3Y8.42%
Revenue Next 5Y9.66%
EBIT growth 1Y18.69%
EBIT growth 3Y21.69%
EBIT growth 5Y16.49%
EBIT Next Year38.3%
EBIT Next 3Y18.56%
EBIT Next 5Y16.32%
FCF growth 1Y65.97%
FCF growth 3Y19.76%
FCF growth 5Y21.96%
OCF growth 1Y54.29%
OCF growth 3Y16.76%
OCF growth 5Y18.17%
NETEASE INC-ADR / NTES FAQ
What is the ChartMill fundamental rating of NETEASE INC-ADR (NTES) stock?
ChartMill assigns a fundamental rating of 7 / 10 to NTES.
What is the valuation status for NTES stock?
ChartMill assigns a valuation rating of 8 / 10 to NETEASE INC-ADR (NTES). This can be considered as Undervalued.
What is the profitability of NTES stock?
NETEASE INC-ADR (NTES) has a profitability rating of 9 / 10.
How financially healthy is NETEASE INC-ADR?
The financial health rating of NETEASE INC-ADR (NTES) is 8 / 10.
Can you provide the expected EPS growth for NTES stock?
The Earnings per Share (EPS) of NETEASE INC-ADR (NTES) is expected to grow by 21.69% in the next year.