Tencent Holdings Limited Fundamental Analysis
Tencent Holdings Limited Fundamental Analysis
Tencent Holdings Limited (0700.HK) shows moderate financial fundamentals with a PE ratio of 15.47, profit margin of 30.61%, and ROE of 20.55%. The company generates $764.6B in annual revenue with N/A year-over-year growth of N/A.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 91.9/100 based on profitability, valuation, growth, and balance sheet metrics. The A grade reflects excellent fundamentals and strong overall stability.
Fundamental Health Score
We analyze 0700.HK's fundamental strength across five key dimensions:
Efficiency Score
Excellent0700.HK demonstrates superior asset utilization.
Valuation Score
Excellent0700.HK trades at attractive valuation levels.
Growth Score
Moderate0700.HK shows steady but slowing expansion.
Financial Health Score
Excellent0700.HK maintains a strong and stable balance sheet.
Profitability Score
Excellent0700.HK achieves industry-leading margins.
Key Financial Metrics
Is 0700.HK Expensive or Cheap?
P/E Ratio
0700.HK trades at 15.47 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, 0700.HK's PEG of 0.96 indicates potential undervaluation.
Price to Book
The market values Tencent Holdings Limited at 3.21 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 10.35 times EBITDA. This signals the market has high growth expectations.
How Well Does 0700.HK Make Money?
Net Profit Margin
For every $100 in sales, Tencent Holdings Limited keeps $30.61 as profit after all expenses.
Operating Margin
Core operations generate 32.56 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $20.55 in profit for every $100 of shareholder equity.
ROA
Tencent Holdings Limited generates $11.47 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tencent Holdings Limited generates strong operating cash flow of $326.73B, reflecting robust business health.
Free Cash Flow
Tencent Holdings Limited generates strong free cash flow of $225.49B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $25.02 in free cash annually.
FCF Yield
0700.HK converts 6.29% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
15.47
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.96
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.21
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.69
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.36
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.43
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.21
vs 25 benchmark
ROA
Return on assets percentage
0.11
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How 0700.HK Stacks Against Its Sector Peers
| Metric | 0700.HK Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 15.47 | 21.04 | Better (Cheaper) |
| ROE | 20.55% | 584.00% | Weak |
| Net Margin | 30.61% | -283.00% (disorted) | Strong |
| Debt/Equity | 0.36 | 0.82 | Strong (Low Leverage) |
| Current Ratio | 1.43 | 1.88 | Neutral |
| ROA | 11.47% | -5.00% (disorted) | Strong |
0700.HK outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tencent Holdings Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
N/A
Industry Style: Growth, Technology, Streaming
EPS CAGR
N/A
Industry Style: Growth, Technology, Streaming
FCF CAGR
N/A
Industry Style: Growth, Technology, Streaming