Citi: Tencent’s stock price has fallen excessively, but its gaming business remains solid
Citigroup said Tencent's share price fell on Wednesday to create a better buying point, and the market's concerns about a slowdown in its gaming revenue in the second quarter were overdone. Citi analysts such as Alicia Yap wrote in the report that Sensor Tower data shows that the company's game revenue may have declined in the second quarter, but this does not reflect the full picture because the consumption behavior of Android users may be different. Even if Tencent's second-quarter game revenue is disappointing, thanks to increasing globalization and diversified game product portfolio, this fluctuation should not affect the basic strength of the company's game business. Citigroup expects Tencent's domestic game revenue to decline by 3.9% in the second quarter, but to increase by 8% year-on-year. Tencent ADR fell 6.1% on Wednesday; Hong Kong stocks fell 7.1%.