Guest roark33 Posted May 11, 2017 Share Posted May 11, 2017 Anyone look at this name. I am not a gamer at all. Just seems like a money printing press over there....yikes. Link to comment Share on other sites More sharing options...
rb Posted May 11, 2017 Share Posted May 11, 2017 It looks like a really good business. However I cannot trust the financials of most things China. So for me it would be a pass. Link to comment Share on other sites More sharing options...
abyli Posted May 12, 2017 Share Posted May 12, 2017 It is one of the best run Chinese companies out there! It dropped below $0.25 back in 2001, up 1000 times during last 16 years, unbelievable! If you are non-Chinese, you might have difficulty analyzing Chinese companies. In gaming industry in China, there are only three players: Tencent (Parent company of WeChat, 46% market share. Yes Tencent is a mostly gaming company), NetEase (28% market share) and Others. :-) NetEase had the best gaming producer record in the world: their top two games last longest. e.g. 大话西游 was created in August 2002, now it is still top 10 playing games in China. On e-commerce segment, Q1 2017 sales tripled from Q1 2016... CEO William Ding still owns 58.5% the company. People on this board think Li Lu is the best Chinese investor, that might not be true. There is this guy with the name Duan YongPing. He bought NetEase below $0.25 in 2001 and made about 120 times in a few years. Then he bid to lunch with Warren Buffett in 2006. In early 2011 he put 100% of capital into Apple shares. He is also chairman of OPPO and VIVO.... Link to comment Share on other sites More sharing options...
crastogi Posted May 12, 2017 Share Posted May 12, 2017 It is one of the best run Chinese companies out there! It dropped below $0.25 back in 2001, up 1000 times during last 16 years, unbelievable! If you are non-Chinese, you might have difficulty analyzing Chinese companies. In gaming industry in China, there are only three players: Tencent (Parent company of WeChat, 46% market share. Yes Tencent is a mostly gaming company), NetEase (28% market share) and Others. :-) NetEase had the best gaming producer record in the world: their top two games last longest. e.g. 大话西游 was created in August 2002, now it is still top 10 playing games in China. On e-commerce segment, Q1 2017 sales tripled from Q1 2016... CEO William Ding still owns 58.5% the company. People on this board think Li Lu is the best Chinese investor, that might not be true. There is this guy with the name Duan YongPing. He bought NetEase below $0.25 in 2001 and made about 120 times in a few years. Then he bid to lunch with Warren Buffett in 2006. In early 2011 he put 100% of capital into Apple shares. He is also chairman of OPPO and VIVO.... what are your thoughts on its future? don't know much about gaming industry and I am leery of china, but the financials are incredible! Link to comment Share on other sites More sharing options...
abyli Posted May 12, 2017 Share Posted May 12, 2017 It is one of the best run Chinese companies out there! It dropped below $0.25 back in 2001, up 1000 times during last 16 years, unbelievable! If you are non-Chinese, you might have difficulty analyzing Chinese companies. In gaming industry in China, there are only three players: Tencent (Parent company of WeChat, 46% market share. Yes Tencent is a mostly gaming company), NetEase (28% market share) and Others. :-) NetEase had the best gaming producer record in the world: their top two games last longest. e.g. 大话西游 was created in August 2002, now it is still top 10 playing games in China. On e-commerce segment, Q1 2017 sales tripled from Q1 2016... CEO William Ding still owns 58.5% the company. People on this board think Li Lu is the best Chinese investor, that might not be true. There is this guy with the name Duan YongPing. He bought NetEase below $0.25 in 2001 and made about 120 times in a few years. Then he bid to lunch with Warren Buffett in 2006. In early 2011 he put 100% of capital into Apple shares. He is also chairman of OPPO and VIVO.... what are your thoughts on its future? don't know much about gaming industry and I am leery of china, but the financials are incredible! They started testing their modified version of Minecraft in China in April and will release it in July, 2017. In the last 30-40 years, Minecraft was the #2 best game ever. They will not sell the copy in China, instead they will give the game out for free but make money from other things. There are also other games in the pipeline. It is a great company and the numbers are real (No doubt at all). I really admire what William has achieved since 1997. They are #1 free email provider in China with most users, top 1 or 2 player in Music (closest competitor is again Tencent). Just like Apple, they focus all their attention on user experience. In lots of areas, they were not the first to get there, but during long time, they became the best slowly. To give you an example, when they got started in Music, William himself listened 8000 unique songs completely before NetEase launched the platform. Nowadays lots of Chinese can not live without NetEase Cloud Music. :-) Great CEO, great business model, great corporate culture and great price. :-) Link to comment Share on other sites More sharing options...
crastogi Posted May 12, 2017 Share Posted May 12, 2017 It is one of the best run Chinese companies out there! It dropped below $0.25 back in 2001, up 1000 times during last 16 years, unbelievable! If you are non-Chinese, you might have difficulty analyzing Chinese companies. In gaming industry in China, there are only three players: Tencent (Parent company of WeChat, 46% market share. Yes Tencent is a mostly gaming company), NetEase (28% market share) and Others. :-) NetEase had the best gaming producer record in the world: their top two games last longest. e.g. 大话西游 was created in August 2002, now it is still top 10 playing games in China. On e-commerce segment, Q1 2017 sales tripled from Q1 2016... CEO William Ding still owns 58.5% the company. People on this board think Li Lu is the best Chinese investor, that might not be true. There is this guy with the name Duan YongPing. He bought NetEase below $0.25 in 2001 and made about 120 times in a few years. Then he bid to lunch with Warren Buffett in 2006. In early 2011 he put 100% of capital into Apple shares. He is also chairman of OPPO and VIVO.... what are your thoughts on its future? don't know much about gaming industry and I am leery of china, but the financials are incredible! They started testing their modified version of Minecraft in China in April and will release it in July, 2017. In the last 30-40 years, Minecraft was the #2 best game ever. They will not sell the copy in China, instead they will give the game out for free but make money from other things. There are also other games in the pipeline. It is a great company and the numbers are real (No doubt at all). I really admire what William has achieved since 1997. They are #1 free email provider in China with most users, top 1 or 2 player in Music (closest competitor is again Tencent). Just like Apple, they focus all their attention on user experience. In lots of areas, they were not the first to get there, but during long time, they became the best slowly. To give you an example, when they got started in Music, William himself listened 8000 unique songs completely before NetEase launched the platform. Nowadays lots of Chinese can not live without NetEase Cloud Music. :-) Great CEO, great business model, great corporate culture and great price. :-) Thank you! Link to comment Share on other sites More sharing options...
Jurgis Posted May 12, 2017 Share Posted May 12, 2017 About 5-7 years ago I've invested in a bunch of Chinese gaming companies. I did not know China, local gaming or other info, so I invested on valuation into what appears 2nd/3rd rate companies. KONG (bought out or went private), PWRD (went private?), CYOU (went nowhere I see), SNDA/GAME (split then bought out/ went private), etc. IIRC, NTES was expensive back then since people were running up the price because of their WoW license. So I never bought it. Even if I had, I'd probably have had difficult time holding on to it without knowing the things abyli described. I'm afraid that's the same situation now. Clearly they have done well, but without knowing Chinese gaming / music / etc. landscape and its future, it's hard to buy and hold. Good luck to people who know this better and invest into it. 8) Link to comment Share on other sites More sharing options...
abyli Posted May 12, 2017 Share Posted May 12, 2017 About 5-7 years ago I've invested in a bunch of Chinese gaming companies. I did not know China, local gaming or other info, so I invested on valuation into what appears 2nd/3rd rate companies. KONG (bought out or went private), PWRD (went private?), CYOU (went nowhere I see), SNDA/GAME (split then bought out/ went private), etc. IIRC, NTES was expensive back then since people were running up the price because of their WoW license. So I never bought it. Even if I had, I'd probably have had difficult time holding on to it without knowing the things abyli described. I'm afraid that's the same situation now. Clearly they have done well, but without knowing Chinese gaming / music / etc. landscape and its future, it's hard to buy and hold. Good luck to people who know this better and invest into it. 8) Yeah, I feel we are lucky as Chinese to know those fantastic companies in China. It is not easy for Non-Chinese to fully understand the landscape of Chinese markets. The companies you bought are just so so companies. The great companies are like Tencent, Alibaba, NetEase, JD.com. Some might include Baidu, but IMHO they do not have as good corporate culture as others, more towards engineers managed company, that is why Baidu is having difficulty to grow now. When I say great companies, I mean comparable to companies like Apple, Google, Facebook level. NetEase stock price was up 100000% last 16 years. Does it deserve a deep look? It just increased quarterly dividend to $1.08 per share (pay out 25% earnings). GAAP Q1 2017 EPS was $4.29 (their weakest quarter season wise). Net revenue up 72.3% from Q1 2016. For fiscal year 2016, net revenue was up 67.4% from 2015 level. No debt, Cash in hand was $44 per share as of Q1 2017. Cheers. Link to comment Share on other sites More sharing options...
vegaseller Posted July 27, 2017 Share Posted July 27, 2017 After looking at the financials, the company seems almost too good to be true. 30%+ topline growth, 20-30% consistent ROE, 17-20x PE net cash. RMB40 billion on the balance sheet. Business seems to be diversified between overseas IPs licensing and their own IP. Strange stuff with the pig farms though. Link to comment Share on other sites More sharing options...
Jurgis Posted July 27, 2017 Share Posted July 27, 2017 After looking at the financials, the company seems almost too good to be true. 30%+ topline growth, 20-30% consistent ROE, 17-20x PE net cash. RMB40 billion on the balance sheet. As I've said, I'm not a local expert, but from what I remember if you looked at Tencent for last 10+ years, you'd see similar picture. More expensive usually, but great numbers and great stock performance. So, yeah, it could be real and not too good to be true. But there's also Chinese company risk that we may not know something and it is too good to be true. You need boots on the ground or somewhat blind trust. Link to comment Share on other sites More sharing options...
vegaseller Posted July 29, 2017 Share Posted July 29, 2017 I have written up some of my initial thoughts on the gaming sector in general and will do some more research/write-ups on Netease in the coming few weeks/month. I would be happy for any comments/thoughts, I am sure there are lots of things I haven't thought of and could use advice on. https://etherealvalue.wordpress.com/2017/07/29/gaming-sector-primer/ Link to comment Share on other sites More sharing options...
saltybit Posted August 7, 2017 Share Posted August 7, 2017 What are some good ways to follow these kinds of developments in China if one can also read Chinese, but not local? Link to comment Share on other sites More sharing options...
saltybit Posted August 10, 2017 Share Posted August 10, 2017 Q2 2017 results out http://www.netease.com/phoenix.zhtml?c=122303&p=irol-reportsother Link to comment Share on other sites More sharing options...
vegaseller Posted November 17, 2017 Share Posted November 17, 2017 I have written up some of my initial thoughts on the gaming sector in general and will do some more research/write-ups on Netease in the coming few weeks/month. I would be happy for any comments/thoughts, I am sure there are lots of things I haven't thought of and could use advice on. https://etherealvalue.wordpress.com/2017/07/29/gaming-sector-primer/ Some initial thoughts on netease https://etherealvalue.wordpress.com/2017/11/16/netease-nasdaq-ntes/ Link to comment Share on other sites More sharing options...
MattR Posted December 26, 2020 Share Posted December 26, 2020 There has been a recent VIC writeup that is great. https://www.valueinvestorsclub.com/idea/NETEASE_INC/2270909251 I have a substantial amount of my portfolio invested in Netease after a huge amount of research. Would love to know what the forum thinks about them now. Link to comment Share on other sites More sharing options...
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