One Chinese tech stock has gotten a lot of love from analysts in recent weeks. It is the internet giant Tencent, which is known for its gaming business and runs WeChat, one of the largest messaging applications in the world. Fourteen analysts have raised their price target for the stock and none have lowered it in the past three weeks, according to a CNBC Pro screen using FactSet. CNBC Pro is filtered for stocks whose price targets were raised during that period by all of the covering analysts. Tencent was also the only stock Goldman added to the July version of its monthly Asia-Pacific confidence list. This list includes a bank-selected selection of between the 15 and 30 highest-rated stocks for the region. Of all Chinese internet stocks, Tencent offers “one of the most visible and sustainable profit growth” of around 20%, Goldman said in a July 1 note. It is thanks to the “acceleration” in game revenue driven by new game titles and advertising market share gains, added the bank. Those two factors haven’t been reflected in the stock’s value, Goldman said. The bank gave Tencent a price target of 477 Hong Kong dollars ($61), or a potential upside of about 24%. In a June note, Jefferies said Tencent has demonstrated “strong execution” in game strategies to “rejuvenate existing games with a solid pipeline.” “We consider Tencent to be a global mobile gaming leader, with a proven track record in developing successful games,” Jefferies said, citing it as a top choice in China’s internet sector. “Tencent’s evolution from consumer to industrial internet, while maintaining a solid foundation in games and increasing its advertising market share, paves the way for future success,” he said. According to FactSet, 97% of analysts who cover the stock give it a buy rating, with a potential upside of 21.8% on the consensus price target. Tencent shares are up nearly 30% year-to-date. Tencent’s first quarter earnings showed that they beat estimates for revenue and profit. Adjusted net profit rose 62% year over year – the fastest growth since the March quarter in 2021.
14 analysts raised their price targets on the Chinese tech giant in the last 3 weeks
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