NetEase (NASDAQ:NTES) Shares Gap Up - Still a Buy?

Key Points

• NetEase shares gapped higher, opening at $120.66 versus a prior close of $115.41 and last trading near $121.09.
• Analyst sentiment remains positive overall, with seven Buy ratings and three Holds producing a “Moderate Buy” consensus and an average price target of $163.62.
• NetEase reduced its quarterly dividend to $0.48 from $0.72, resulting in a $1.92 annualized payout and a 1.6% yield; insiders own 54.7% of the company.

NetEase, Inc. (NASDAQ:NTES - Get Free Report) shares gapped up prior to trading on Monday. The stock had previously closed at $115.41, but opened at $120.66. NetEase shares last traded at $121.0910, with a volume of 157,681 shares traded.

Analyst Ratings Changes

Several research analysts have commented on NTES shares. Zacks Research lowered shares of NetEase from a "strong-buy" rating to a "hold" rating in a research note on Monday, July 27th. Morgan Stanley restated an "overweight" rating and issued a $163.00 target price on shares of NetEase in a report on Monday. Wall Street Zen cut shares of NetEase from a "buy" rating to a "hold" rating in a research note on Sunday, August 2nd. BNP Paribas Exane assumed coverage on shares of NetEase in a report on Tuesday, September 22nd. They set an "outperform" rating and a $180.00 price target on the stock. Finally, The Goldman Sachs Group set a $169.00 price objective on shares of NetEase in a research report on Wednesday, July 1st. Seven investment analysts have rated the stock with a Buy rating and three have given a Hold rating to the company's stock. According to MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average price target of $163.62.

NetEase Price Performance

The firm has a market capitalization of $77.76 billion, a P/E ratio of 16.73, a P/E/G ratio of 1.34 and a beta of 0.72. The firm has a 50-day moving average price of $123.19 and a two-hundred day moving average price of $120.55.

NetEase Cuts Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, September 18th. Investors of record on Thursday, September 3rd were paid a $0.48 dividend. The ex-dividend date of this dividend was Thursday, September 3rd. This represents a $1.92 annualized dividend and a yield of 1.6%. This is a drop from NetEase's previous quarterly dividend of $0.72. NetEase's payout ratio is 26.31%.

Insiders Place Their Bets

In other NetEase news, VP Aileen Mo sold 716 shares of the business's stock in a transaction dated Wednesday, September 2nd. The shares were sold at an average price of $120.64, for a total value of $86,378.24. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. 54.70% of the stock is owned by insiders.

Hedge Funds Weigh In On NetEase

A number of institutional investors have recently modified their holdings of NTES. V Square Quantitative Management LLC bought a new stake in shares of NetEase during the first quarter valued at approximately $25,000. Harbour Investments Inc. grew its stake in NetEase by 7,480.0% in the fourth quarter. Harbour Investments Inc. now owns 379 shares of the technology company's stock worth $52,000 after purchasing an additional 374 shares in the last quarter. MidFirst Bank purchased a new position in NetEase during the 4th quarter worth $57,000. Allworth Financial LP increased its holdings in NetEase by 210.2% during the 2nd quarter. Allworth Financial LP now owns 667 shares of the technology company's stock worth $85,000 after purchasing an additional 452 shares during the period. Finally, EverSource Wealth Advisors LLC raised its position in NetEase by 16.0% during the 1st quarter. EverSource Wealth Advisors LLC now owns 777 shares of the technology company's stock valued at $87,000 after purchasing an additional 107 shares in the last quarter. 11.07% of the stock is owned by hedge funds and other institutional investors.

NetEase Company Profile

NetEase, Inc is a Chinese internet and technology company that develops and operates online games, digital content services and other internet-related products. Founded in 1997 by Ding Lei, the company has grown into a global developer and publisher of games for personal computers and mobile devices.

NetEase Games is the company's primary business and offers original titles across genres including role-playing, strategy, action and competitive gaming. The company also publishes games through partnerships with international developers and operates game studios in China and overseas.

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