The new valuation is at a steep discount from Neo’s $185-million financing in spring 2022, which valued it at more than $1-billion. That is consistent with other financial technology firms that have been devalued since 2022. Tencent stock is trading at roughly successfully outsource software development 18 times its earnings over the trailing-12-month period.

Year Return

Tencent had been a hallmark of consistent and sustainable growth, with an unbroken track record of growth since it went public in 2004. So when the tech company reported that its revenue and operating profit fell by 1% and 13%, respectively, in 2022, investors would have found it difficult to swallow. The internet and technology company reported $80.6 billion in total revenues in 2023, up 10% from 2022. Its profit attributable to equity holders after stripping out one-time or non-cash items was $22.3 billion, a 36% increase from 2022.

How to invest

To keep making money from its ecosystem, all it has to do is ensure that it remains the preferred communication platform in China. Fortunately, it is the only game in town, and it could keep that position for a while. However, Chinese companies have higher risk profiles than those listed in the U.S. due to review make the deal: negotiating mergers and acquisitions geopolitical concerns, foreign exchange rate fluctuations, and governance differences. Investors interested in Tencent need to weigh whether its upside potential is worth the risk. A big part of Tencent is its uber-popular WeChat/Weixin super app. The platform enables users to send messages, share photos and videos, shop online, and make payments.

Tencent Holdings Company Description

Not everyone wants to be an active stock picker, especially when it comes to investing internationally. Thanks to exchange-traded funds (ETFs), you don’t have to actively manage a portfolio Direct quote currency of stocks. You can passively invest in an ETF that holds stocks based around a common theme or broad market index, such as Chinese stocks. In mid-2024, Tencent’s dividend yield was less than 1% (given its share price and the exchange rates at the time), less than the S&P 500’s roughly 1.4% dividend yield. Given Tencent’s lower yield, annual payment schedule, and the risk of foreign exchange rate fluctuations, it’s likely not a very appealing option for most dividend-focused investors.

Our experts picked 7 Zacks Rank #1 Strong Buy stocks with the best chance to skyrocket within the next days. This company is expected to earn $3.21 per share for the fiscal year ending December 2024, which represents a year-over-year change of 39%. Tencent’s recent business performance might not have been inspiring, but the issues that caused it difficulty are likely temporary. E-commerce continue to grow, and these companies are on the front lines. The company was founded in 1998 and is headquartered in Shenzhen, the People’s Republic of China. Five eminent speakers, including Nobel laureates and the top Chinese physicist Qi-Kun Xue, share groundbreaking insights at the Tencent WE Summit in Chengdu.

• How have some of China’s biggest tech companies fared in their third-quarter earnings revelations?
• This company is expected to earn $3.21 per share for the fiscal year ending December 2024, which represents a year-over-year change of 39%.
• The platform enables users to send messages, share photos and videos, shop online, and make payments.
• However, Chinese companies have higher risk profiles than those listed in the U.S. due to geopolitical concerns, foreign exchange rate fluctuations, and governance differences.
• Tencent Cloud is probably safe from the antitrust regulators since it ranks third in China’s cloud infrastructure market after Alibaba and Huawei.

Can I buy shares in Tencent?

Since 1988 it has more than doubled the S&P 500 with an average gain of +24.10% per year. These returns cover a period from January 1, 1988 through October 7, 2024. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return.

The company was founded in 1998 and is headquartered in Shenzhen, the People’s Republic of China. At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system.

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The Tencent-led deal appears to be structured in a way to allay geopolitical concerns, should they arise, about a Chinese company owning just under 10 per cent of a consumer-focused Canadian financial services company. All Chinese-based companies are required under Chinese law to share information with its government, if requested. Similar concerns have led to bans on the use of telecom equipment made by China’s Huawei Technologies Co. With 1.3 billion monthly active users (MAU), its user base includes almost everyone in China. And they use it not only for communication but also to access services such as online payments, ride-sharing, public transportation, entertainment, online gaming, and more.

Tencent and many other China-based companies saw their valuations surge late in September after new stimulus initiatives were announced, but momentum is fading as investors are becoming more skeptical about the scope of the economic support. But the bigger culprits were external factors such as China’s economic weakness, which was caused in part by that nation’s extended and strict COVID lockdowns. Other Chinese government policies also hurt Tencent’s financials in 2022. For example, its regulatory crackdowns on the online education and tech industries have severely impacted Tencent’s advertising and cloud income.