Key Takeaways:
- Morgan Stanley raised its NetEase price target to USD 158 from USD 154
- JPMorgan lifted its NTES-S target to HKD 290 from HKD 280
- NetEase shares opened 4.5% higher and traded up 3.6% on the day
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NetEase rises 3.6% as Morgan Stanley, JPMorgan raise price targets
NetEase Inc. shares rose as much as 4.5% after Morgan Stanley and JPMorgan raised their price targets, citing stronger margins and gaming revenue growth.
Morgan Stanley maintained its Overweight rating and lifted its price target on NetEase (NTES.US) to USD 158 from USD 154, representing about 11% upside from the last close. The broker raised its net profit forecasts for 2026 through 2028 by 2.2%, 4.3% and 5.2%, respectively, reflecting stronger gross margins in the first-quarter results and better operating expense management, analysts said.
"We see continued growth in gaming revenue driven by evergreen titles and potential upside from new game launches," Morgan Stanley analysts wrote in a note. The firm set a bull-case target of USD 191 and a bear-case target of USD 106.
JPMorgan reiterated NetEase as its top pick in the digital entertainment sector. The bank raised its target for the Hong Kong-listed shares (09999.HK) to HKD 290 from HKD 280 and for the US-listed shares to USD 185 from USD 180, both with an Overweight rating. The revision followed a 2% increase in its 2026 earnings-per-share forecast, driven by improved margins across existing games.
NetEase's Hong Kong shares opened 4.5% higher and last traded at HKD 196.1, up 3.6%, with turnover of HKD 955 million. The stock has gained about 15% year to date, outperforming the Hang Seng Index.
The dual upgrades signal that analysts expect NetEase's margin trajectory to sustain as its mature game portfolio generates steady cash flow while new titles add incremental growth. Investors will watch the company's next quarterly update for further detail on its pipeline of mobile game launches across domestic and international markets.
This article is for informational purposes only and does not constitute investment advice.
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