700:HKG - Embedded Expectations Analysis - 2018 10 29
Tencent Holdings Limited (700:HKG) currently trades below recent averages relative to UAFRS-based (Uniform) Earnings, with a 17.3x Uniform P/E, implying bearish expectations for the firm. Moreover, management may have concerns about their ability to increase smartphone game market share, get approval to monetize mobile games, and sustain revenue growthSpecifically, management may lack confidence in their ability to sustain growth in smartphone game market share, and in the sustainability of higher user engagement in their key mobile game genres. Moreover, they may be concerned about their ability to maintain leadership in online video, news, music services, and literature, and to sustain strong YoY revenue growth. Furthermore, they may lack confidence in their ability to maintain strong growth of mobile payments through their social network platform and daily mini video views, and may be concerned about the decline in smartphone game revenue in the quarter. Finally, they may lack confidence in their ability to offset headwinds on earnings growth, and to get approval for monetization of their mobile games
Tencent Holdings Limited is an investment holding company principally involved in the provision of value-added services (VAS) and online advertising services. The Company operates through three main segments. The VAS segment is mainly involved in provision of online/mobile games, community value-added services and applications across various Internet and mobile platforms. The Online Advertising segment is mainly engaged in display based and performance based advertisements. The Others segment is mainly involved in provision of payment related services, cloud services and other services.
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