12.00k followers • 19 symbols Watchlist by Motif Investing
Chinese internet companies grow their users bases and their ability to monetize them, could result in rapid revenue and earnings growth.
Curated by Motif Investing
China's already the biggest internet market in the world. But their 591 million users represent a tiny 44% penetration rate. Which means there's plenty of room to grow. During the first half of 2013, 26 million Chinese opened a browser for the first time.
But here’s the angle: China's internet market is dominated by local companies. They'll skip over Google to search with Baidu, which controls 65.7% of the market. China's online advertising market reached $11 billion in 2012, up 46.8% over 2011 and is expected to grow further. China has already surpassed the U.S. as the world's largest market for smartphones and by the end of 2013 it is expected to be twice the size of the U.S. market. All of which has many investors looking East for potential good fortune.
We identified US-listed stocks and American Depository Receipts of companies that are engaged in activities relevant to this watchlist's theme. We then filtered out companies that have a share price of less than $1.00 or a market capitalization less than $100 million, and excluded illiquid stocks by screening companies for liquidity i.e. average bid-ask spreads, dollar volume traded etc. Finally the proprietary Motif Optimization Engine determined the constituent stocks. Learn more about how we select our watchlists.Who made these selections?
Motif is an online brokerage built on thematic portfolios of up to 30 stocks and ETFs. Founded in 2010 by Hardeep Walia, Motif combines complex proprietary algorithms with skilled advisers to develop these thematic portfolios. Learn more about our team.How are these weighted?
First, we determined each company's percentage of total revenue derived from this watchlist's theme. Second, we applied a pure-play factor to give greater relative weight to companies that derive a higher percentage of their revenue from this theme. Finally, we weighted each company by its market capitalization adjusted for revenue exposure to the theme.
More details on how we build and weight watchlists are available here.
|Watchlist||Change today||1-month return||1-year return||Total return|
|Symbol||Company name||Last price||Change||% change||Market time||Volume||Avg vol (3-month)||Market cap|
|JD||JD.com, Inc.||64.57||+0.04||+0.06%||4:00 pm GMT-4||7.55M||14.82M||99.26B|
|NTES||NetEase, Inc.||479.78||+10.79||+2.30%||4:00 pm GMT-4||607.92k||909.45k||65.05B|
|BIDU||Baidu, Inc.||126.67||+6.12||+5.08%||4:00 pm GMT-4||3.85M||4.18M||43.66B|
|VIPS||Vipshop Holdings Limited||22.52||-0.38||-1.66%||4:00 pm GMT-4||3.46M||6.24M||15.14B|
|ATHM||Autohome Inc.||89.89||+1.82||+2.07%||4:00 pm GMT-4||266.02k||661.00k||10.70B|
|WUBA||58.com Inc.||55.65||+0.30||+0.54%||4:00 pm GMT-4||2.16M||1.71M||8.34B|
|WB||Weibo Corporation||35.47||+0.62||+1.78%||4:00 pm GMT-4||744.44k||1.91M||8.03B|
|YY||JOYY Inc.||82.16||+0.91||+1.12%||4:00 pm GMT-4||533.76k||1.20M||6.62B|
|MOMO||Momo Inc.||18.81||+0.11||+0.59%||4:00 pm GMT-4||1.75M||4.64M||3.93B|
|BZUN||Baozun Inc.||43.02||+0.22||+0.51%||4:00 pm GMT-4||615.42k||1.31M||2.70B|
|SINA||SINA Corporation||40.4||+0.16||+0.40%||4:00 pm GMT-4||703.54k||784.42k||2.40B|
|BITA||Bitauto Holdings Limited||15.9||-||-||4:00 pm GMT-4||369.31k||589.57k||1.13B|
|SOHU||Sohu.com Limited||23||-0.12||-0.52%||4:00 pm GMT-4||1.20M||818.85k||903.18M|
|CYOU||Changyou.com Limited||10.74||+0.01||+0.09%||4:00 pm GMT-4||406.53k||406.53k||575.75M|
|JMEI||Jumei International Holding Limited||19.93||-0.01||-0.05%||4:02 pm GMT-4||81.88k||81.88k||227.59M|
|WBAI||500.com Limited||3.73||-0.22||-5.57%||4:00 pm GMT-4||17.57k||60.16k||160.39M|
|TOUR||Tuniu Corporation||1.22||+0.16||+15.09%||3:59 pm GMT-4||861.99k||701.78k||150.51M|
|SFUN||Fang Holdings Limited||14.15||-1.75||-11.01%||4:00 pm GMT-4||40.50k||18.16k||126.98M|
(Bloomberg) -- Tencent Holdings Ltd. is driving discussions to merge China’s biggest game-streaming platforms Huya Inc. and DouYu International Holdings Ltd., people familiar with the matter said, in a deal that would allow it to dominate the $3.4 billion arena.The Chinese social media titan -- which owns a 37% stake in Huya and 38% of DouYu -- has been discussing such a merger with the duo over the past few months, although details have yet to be finalized, said the people, who asked not to be identified because discussions are private. Tencent is seeking to become the largest shareholder in the combined entity, one person said.A deal would create an online giant with more than 300 million users and a combined market value of $10 billion, cementing Tencent’s lead in Chinese games and social media. Faced with rising competition for advertisers from ByteDance Ltd. and its rapidly growing stable of apps, the WeChat operator would then run a highly profitable service akin to Amazon.com Inc.’s Twitch. Huya and DouYu would keep their respective platforms and branding while working more closely with Tencent’s own esports site eGame, said the people.“As the major shareholder of both platforms, Tencent would benefit because a merger would remove unnecessary competition between them,” Bloomberg Intelligence analyst Vey-Sern Ling said. “The enlarged scale can also help to drive cost synergies and fend off emerging competitors.”Tencent’s shares were up 1.5% in afternoon trade. Tencent and DouYu representatives declined to comment, while Huya spokespeople didn’t respond to requests for comment.Tencent’s shoring up its home-market position against the backdrop of a Trump administration increasingly hostile toward Chinese tech companies. WeChat has a limited U.S. presence and Trovo Live, a mobile-focused game-streaming service for American consumers, is only in its initial stages.China’s game-streaming market is estimated to generate 23.6 billion yuan ($3.4 billion) in revenue this year, according to iResearch. The country’s streaming networks live and die by the popularity of star players and the virtual tips and gifts that fans buy for them, leading to intense bidding wars for the most-recognized names. Companies like Google-backed Chushou TV shuttered their services after failing to secure new money, while NetEase Inc.’s CC Live has found a small niche in broadcasting its in-house titles.Already featuring Tencent’s marquee games like PUBG Mobile and Honor of Kings, Huya and DouYu have established a clear lead as the top two platforms. Nevertheless, revenue growth slowed down for both in recent quarters as users shifted their attention to ByteDance’s Douyin, the Chinese twin to the globally popular TikTok short-video service. A merger would help them lower broadcast and content costs at a time when rival video services like Kuaishou and Bilibili Inc -- both also backed by Tencent -- intensify their efforts to compete for more gaming content.In April, Tencent bought an additional stake in Huya for about $260 million from Joyy Inc., boosting its voting power in the platform to more than 50%. When asked about the possibility of a merger with Huya, DouYu founder and Chief Executive Officer Chen Shaojie told analysts on a March earnings call: “We believe it’s Tencent’s vision.”(Updates with analyst’s comment from the fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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