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NetEase Inc (ADR) (NTES) Stock Cashes In on China’s Online Gaming

NetEase Inc (ADR) (NASDAQ:NTES) is one of China’s top online gaming companies, especially in the hottest trend — massively multiplayer online role playing games (MMORPG).


And as is typical of many Chinese internet firms, it also has other divisions that help generate a significant amount revenue outside the gaming world as well. It has nearly 1 billion email users and has a respectable advertising and e-commerce division as well.

Unlike its chief Chinese rival, Tencent Holdings Ltd (OTCMKTS:TCEHY), NetEase is gaining a large share of mobile MMORPG market, arguably the hottest sector in gaming. And even if you compare NetEase to its American compatriots Activision Blizzard, Inc. (NASDAQ:ATVI) and Electronic Arts Inc. (NASDAQ:EA), it has been performing like its U.S. cousins. NTES stock is up 46% in the past 12 months, compared to EA and ATVI’s 53% return over the same period.

Tencent is 10x the size, by market capitalization, of NetEase but that isn’t a reason to shy away from this $39...