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NetEase NTES shares soared 8.2% in the last trading session to close at $103.92. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.6% gain over the past four weeks.
The optimism surrounding the stock can primarily be attributable to NetEase’s sustained focus on technological advancements to stay at the forefront of the online gaming and content services industry. The company has decisively maintained a robust growth trajectory in AI-driven subscription services, significantly bolstered by its advanced AI power tool, which has dramatically enhanced functionality and user appeal. As the company continues to invest in new technologies and build valuable relationships, it positions itself favorably for future opportunities and evolving consumer demands.
This internet technology company is expected to post quarterly earnings of $1.76 per share in its upcoming report, which represents a year-over-year change of +10%. Revenues are expected to be $3.76 billion, down 1.6% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For NetEase, the consensus EPS estimate for the quarter has been revised 4.5% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on NTES going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
NetEase belongs to the Zacks Internet - Software and Services industry. Another stock from the same industry, RingCentral RNG, closed the last trading session 2% higher at $33.45. Over the past month, RNG has returned -16.4%.
For RingCentral , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.96. This represents a change of +11.6% from what the company reported a year ago. RingCentral currently has a Zacks Rank of #3 (Hold).
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NetEase, Inc. (NTES) : Free Stock Analysis Report
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