- Tencent's share price was up +50.7% in 2020, but its current share price is -19.1% off its all-time share price peak registered in late-January 2021.
- Tencent's overall 4Q 2020 revenue and adjusted earnings met market expectations, but all eyes are on the -6% QoQ decline in revenue for Tencent's online games business in 4Q 2020.
- The market values Tencent at 32.7 times consensus forward FY 2021 P/E, which is on par with the stock's three-year and five-year mean forward P/E multiples.
- Tencent's share price has been dropping in the past two months, as the market expects a slower pace of growth for the company in 2021, and regulatory headwinds have intensified.
- I have a Neutral rating for Tencent, considering uncertainty over future regulations governing the Chinese technology sector, and slower earnings growth for the company in 2021 and 2022.
For further details see:
Tencent Stock Q4 2020 Earnings: What Investors Should Know