Back to top

Tencent Holding (TCEHY) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

In the latest trading session, Tencent Holding (TCEHY - Free Report) closed at $43.36, marking a +1.38% move from the previous day. The stock lagged the S&P 500's daily gain of 1.5%. Elsewhere, the Dow gained 1.48%, while the tech-heavy Nasdaq added 1.95%.

Coming into today, shares of the company had lost 7.22% in the past month. In that same time, the Computer and Technology sector lost 4.12%, while the S&P 500 lost 4.19%.

Wall Street will be looking for positivity from TCEHY as it approaches its next earnings report date. On that day, TCEHY is projected to report earnings of $0.35 per share, which would represent year-over-year growth of 9.38%. Meanwhile, our latest consensus estimate is calling for revenue of $13.28 billion, up 14.87% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.46 per share and revenue of $56.39 billion. These totals would mark changes of +24.79% and +19.37%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for TCEHY. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.65% higher. TCEHY is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that TCEHY has a Forward P/E ratio of 29.23 right now. Its industry sports an average Forward P/E of 28.28, so we one might conclude that TCEHY is trading at a premium comparatively.

Investors should also note that TCEHY has a PEG ratio of 1.33 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Services was holding an average PEG ratio of 2.55 at yesterday's closing price.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 105, putting it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Tencent Holding Ltd. (TCEHY) - free report >>

Published in