why NetEase Inc. [NTES] is a Good Choice for Investors After New Price Target of $108.48

NetEase Inc. [NASDAQ: NTES] loss -3.67% or -3.16 points to close at $82.89 with a heavy trading volume of 3577682 shares. The company report on February 23, 2023 that Cloud Music Inc. Reports Fiscal Year 2022 Financial Results.

Cloud Music Inc. (HKEX: 9899, “NetEase Cloud Music” or the “Company”), a leading interactive music streaming service provider in China, today announced its financial results for the fiscal year 2022 ended December 31, 2022.

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Summary of Key Financial and Operating Metrics (RMB in thousands, unless otherwise stated).

It opened the trading session at $88.00, the shares rose to $89.80 and dropped to $80.16, the range by which the price of stock traded the whole day. The daily chart for NTES points out that the company has recorded -5.32% loss over the past six months. However, it is still -56.13% lower than its most recent low trading price.

If we look at the average trading volume of 1.77M shares, NTES reached to a volume of 3577682 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here is what top equities market gurus are saying about NetEase Inc. [NTES]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for NTES shares is $108.48 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on NTES stock is a recommendation set at 1.60. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

JP Morgan have made an estimate for NetEase Inc. shares, keeping their opinion on the stock as Neutral, with their previous recommendation back on September 07, 2022. While these analysts kept the previous recommendation, Macquarie raised their target price to Outperform. The new note on the price target was released on July 05, 2022, representing the official price target for NetEase Inc. stock. Previously, the target price had yet another raise from $60 to $120, while JP Morgan kept a Overweight rating on NTES stock.

The Average True Range (ATR) for NetEase Inc. is set at 2.97, with the Price to Sales ratio for NTES stock in the period of the last 12 months amounting to 4.00. The Price to Book ratio for the last quarter was 3.52, with the Price to Cash per share for the same quarter was set at 25.22. Price to Free Cash Flow for NTES in the course of the last twelve months was 19.87 with Quick ratio for the last quarter at 2.30.

Trading performance analysis for NTES stock

NetEase Inc. [NTES] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -4.03. With this latest performance, NTES shares dropped by -7.85% in over the last four-week period, additionally sinking by -5.32% over the last 6 months – not to mention a drop of -9.28% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for NTES stock in for the last two-week period is set at 40.86, with the RSI for the last a single of trading hit 32.57, and the three-weeks RSI is set at 46.68 for NetEase Inc. [NTES]. The present Moving Average for the last 50 days of trading for this stock 82.70, while it was recorded at 85.56 for the last single week of trading, and 83.18 for the last 200 days.

NetEase Inc. [NTES]: A deeper dive into fundamental analysis

Operating Margin for any stock indicates how profitable investing would be, and NetEase Inc. [NTES] shares currently have an operating margin of +18.74 and a Gross Margin at +53.62. NetEase Inc.’s Net Margin is presently recorded at +19.24.

Return on Total Capital for NTES is now 13.96, given the latest momentum, and Return on Invested Capital for the company is 18.72. Return on Equity for this stock inclined to 18.99, with Return on Assets sitting at 11.41. When it comes to the capital structure of this company, NetEase Inc. [NTES] has a Total Debt to Total Equity ratio set at 22.76. Additionally, NTES Total Debt to Total Capital is recorded at 18.54, with Total Debt to Total Assets ending up at 14.12. Long-Term Debt to Equity for the company is recorded at 2.11, with the Long-Term Debt to Total Capital now at 1.72.

Reflecting on the efficiency of the workforce at the company, NetEase Inc. [NTES] managed to generate an average of $633,609 per employee. Receivables Turnover for the company is 12.67 with a Total Asset Turnover recorded at a value of 0.59.NetEase Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 2.30 and a Current Ratio set at 2.30.

NetEase Inc. [NTES]: An earnings per share (EPS) analysis

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for NTES. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for NetEase Inc. go to 7.34%.

An analysis of insider ownership at NetEase Inc. [NTES]

There are presently around $7,123 million, or 15.80% of NTES stock, in the hands of institutional investors. The top three institutional holders of NTES stocks are: INVESCO LTD. with ownership of 11,301,334, which is approximately -17.387% of the company’s market cap and around 45.00% of the total institutional ownership; DODGE & COX, holding 8,796,458 shares of the stock with an approximate value of $729.14 million in NTES stocks shares; and UBS ASSET MANAGEMENT AMERICAS INC, currently with $713.68 million in NTES stock with ownership of nearly -1.991% of the company’s market capitalization.

Positions in NetEase Inc. stocks held by institutional investors increased at the end of Thursday and at the time of the Thursday reporting period, where 148 institutional holders increased their position in NetEase Inc. [NASDAQ:NTES] by around 10,158,184 shares. Additionally, 185 investors decreased positions by around 13,384,501 shares, while 45 investors held positions by with 62,386,237 shares. The mentioned changes placed institutional holdings at 85,928,922 shares, according to the latest SEC report filing. NTES stock had 56 new institutional investments in for a total of 3,069,918 shares, while 53 institutional investors sold positions of 1,456,134 shares during the same period.


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