128.83 USD
-3.27 (-2.48%)
At close: Jan 30, 2026
131.223 USD
+2.39 (+1.86%)
After Hours: 1/30/2026, 8:09:35 PM
Overall NTES gets a fundamental rating of 8 out of 10. We evaluated NTES against 80 industry peers in the Entertainment industry. NTES scores excellent points on both the profitability and health parts. This is a solid base for a good stock. NTES is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings would make NTES suitable for value and quality investing!
1. Profitability
1.1 Basic Checks
- NTES had positive earnings in the past year.
- NTES had a positive operating cash flow in the past year.
- NTES had positive earnings in each of the past 5 years.
- NTES had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- NTES has a Return On Assets of 16.92%. This is amongst the best in the industry. NTES outperforms 92.50% of its industry peers.
- NTES's Return On Equity of 23.22% is amongst the best of the industry. NTES outperforms 90.00% of its industry peers.
- NTES has a Return On Invested Capital of 17.58%. This is amongst the best in the industry. NTES outperforms 93.75% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for NTES is significantly above the industry average of 8.74%.
- The last Return On Invested Capital (17.58%) for NTES is above the 3 year average (14.54%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.92% | ||
| ROE | 23.22% | ||
| ROIC | 17.58% |
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
- With an excellent Profit Margin value of 32.45%, NTES belongs to the best of the industry, outperforming 97.50% of the companies in the same industry.
- NTES's Profit Margin has declined in the last couple of years.
- NTES has a better Operating Margin (31.60%) than 98.75% of its industry peers.
- NTES's Operating Margin has improved in the last couple of years.
- With a decent Gross Margin value of 63.47%, NTES is doing good in the industry, outperforming 70.00% of the companies in the same industry.
- In the last couple of years the Gross Margin of NTES has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 31.6% | ||
| PM (TTM) | 32.45% | ||
| GM | 63.47% |
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
- Compared to 5 years ago, NTES has less shares outstanding
- Compared to 1 year ago, NTES has an improved debt to assets ratio.
2.2 Solvency
- NTES has a debt to FCF ratio of 0.16. This is a very positive value and a sign of high solvency as it would only need 0.16 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 0.16, NTES belongs to the top of the industry, outperforming 91.25% of the companies in the same industry.
- A Debt/Equity ratio of 0.05 indicates that NTES is not too dependend on debt financing.
- NTES has a better Debt to Equity ratio (0.05) than 67.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.05 | ||
| Debt/FCF | 0.16 | ||
| Altman-Z | N/A |
ROIC/WACC2.12
WACC8.29%
2.3 Liquidity
- A Current Ratio of 3.42 indicates that NTES has no problem at all paying its short term obligations.
- NTES has a better Current ratio (3.42) than 87.50% of its industry peers.
- A Quick Ratio of 3.41 indicates that NTES has no problem at all paying its short term obligations.
- The Quick ratio of NTES (3.41) is better than 87.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.42 | ||
| Quick Ratio | 3.41 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 29.11% 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 17.51% on average per year.
- NTES shows a small growth in Revenue. In the last year, the Revenue has grown by 5.81%.
- 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)29.11%
EPS 3Y21.03%
EPS 5Y17.51%
EPS Q2Q%26.66%
Revenue 1Y (TTM)5.81%
Revenue growth 3Y6.32%
Revenue growth 5Y12.19%
Sales Q2Q%8.2%
3.2 Future
- Based on estimates for the next years, NTES will show a very negative growth in Earnings Per Share. The EPS will decrease by -26.15% on average per year.
- The Revenue is expected to grow by 9.57% on average over the next years. This is quite good.
EPS Next Y20.61%
EPS Next 2Y13.13%
EPS Next 3Y12.27%
EPS Next 5Y-26.15%
Revenue Next Year7.4%
Revenue Next 2Y7.74%
Revenue Next 3Y8.19%
Revenue Next 5Y9.57%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- 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
- Based on the Price/Earnings ratio of 14.39, the valuation of NTES can be described as correct.
- Based on the Price/Earnings ratio, NTES is valued cheaper than 87.50% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.30, NTES is valued a bit cheaper.
- NTES is valuated correctly with a Price/Forward Earnings ratio of 13.48.
- Based on the Price/Forward Earnings ratio, NTES is valued cheaply inside the industry as 90.00% of the companies are valued more expensively.
- When comparing the Price/Forward Earnings ratio of NTES to the average of the S&P500 Index (25.57), we can say NTES is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.39 | ||
| Fwd PE | 13.48 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, NTES is valued a bit cheaper than 76.25% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, NTES is valued cheaper than 92.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.33 | ||
| EV/EBITDA | 8.64 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The excellent profitability rating of NTES may justify a higher PE ratio.
- NTES's earnings are expected to grow with 12.27% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.7
PEG (5Y)0.82
EPS Next 2Y13.13%
EPS Next 3Y12.27%
5. Dividend
5.1 Amount
- NTES has a Yearly Dividend Yield of 2.29%.
- Compared to an average industry Dividend Yield of 7.54, NTES pays a better dividend. On top of this NTES pays more dividend than 91.25% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.83, NTES pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.29% |
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
- NTES pays out 36.47% of its income as dividend. This is a sustainable payout ratio.
DP36.47%
EPS Next 2Y13.13%
EPS Next 3Y12.27%
NETEASE INC-ADR / NTES FAQ
What is the ChartMill fundamental rating of NETEASE INC-ADR (NTES) stock?
ChartMill assigns a fundamental rating of 8 / 10 to NTES.
Can you provide the valuation status for NETEASE INC-ADR?
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.
What are the PE and PB ratios of NETEASE INC-ADR (NTES) stock?
The Price/Earnings (PE) ratio for NETEASE INC-ADR (NTES) is 14.39 and the Price/Book (PB) ratio is 3.69.
Is the dividend of NETEASE INC-ADR sustainable?
The dividend rating of NETEASE INC-ADR (NTES) is 6 / 10 and the dividend payout ratio is 36.47%.