It's Showtime for NetEase

Seth Jayson, The Motley Fool
Updated

NetEase (NAS: NTES) is expected to report Q2 earnings on Aug. 15. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict NetEase's revenues will increase 24.7% and EPS will increase 20.9%.

The average estimate for revenue is $334.4 million. On the bottom line, the average EPS estimate is $1.10.


Revenue details
Last quarter, NetEase logged revenue of $318.2 million. GAAP reported sales were 36% higher than the prior-year quarter's $229.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, EPS came in at $1.14. GAAP EPS of $1.14 for Q1 were 33% higher than the prior-year quarter's $0.86 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 67.7%, 200 basis points better than the prior-year quarter. Operating margin was 49.6%, 340 basis points better than the prior-year quarter. Net margin was 47.9%, 130 basis points worse than the prior-year quarter.

Looking ahead
The full year's average estimate for revenue is $1.39 billion. The average EPS estimate is $4.69.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,116 members out of 1,158 rating the stock outperform, and 42 members rating it underperform. Among 292 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 279 give NetEase a green thumbs-up, and 13 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on NetEase is outperform, with an average price target of $61.52.

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The article It's Showtime for NetEase originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend NetEase.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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