NTES(09999) 开源证券·2025-02-21 14:28Investment Rating - The investment rating for the company is "Buy" (maintained) [1][4]. Core Insights - The company achieved a revenue of 105.3 billion yuan in 2024, with a year-on-year growth of 2.91%, and a net profit of 29.7 billion yuan, reflecting a year-on-year increase of 0.96% [4]. - In Q4 2024, the company reported a revenue of 26.7 billion yuan, a year-on-year decrease of 1.45% but a quarter-on-quarter increase of 2.05%, with a net profit of 8.8 billion yuan, showing a year-on-year growth of 33.18% and a quarter-on-quarter growth of 34.08% [4]. - The company is expected to benefit from new product cycles, with projected net profits for 2025, 2026, and 2027 at 34.2 billion yuan, 39 billion yuan, and 42.4 billion yuan respectively, corresponding to EPS of 10.7 yuan, 12.1 yuan, and 13.2 yuan [4]. Revenue and Profitability - The company's revenue from games and related value-added services in Q4 2024 was 21.2 billion yuan, with a year-on-year increase of 1.4% [4]. - The revenue from online music services in 2024 saw a 22% increase, with a gross margin of 33.7%, up by 7 percentage points year-on-year [6]. - The company’s operating profit for Youdao turned positive for the first time in 2024, driven by innovation and AI integration [6]. Product Performance - The game "Marvel Showdown" quickly topped the Steam global sales chart after its overseas launch, with over 10 million registered users within 72 hours, and currently surpassing 40 million [5]. - The game "Yanyun Sixteen Sounds" achieved over 3 million downloads within four days of its domestic launch, with total players exceeding 15 million within two weeks [5]. - The return of Blizzard games like "World of Warcraft" and "Hearthstone" has positively impacted the company's PC game revenue, with further growth expected from the recent return of "Overwatch" [5]. Financial Summary and Valuation Metrics - The company’s projected revenues for 2025, 2026, and 2027 are 120.97 billion yuan, 135.22 billion yuan, and 146.33 billion yuan respectively, with year-on-year growth rates of 14.9%, 11.8%, and 8.2% [7]. - The net profit projections for the same years are 34.23 billion yuan, 38.98 billion yuan, and 42.37 billion yuan, with corresponding year-on-year growth rates of 15.3%, 13.9%, and 8.7% [7]. - The company’s current price-to-earnings (P/E) ratios for 2025, 2026, and 2027 are 14.0, 12.3, and 11.3 respectively, indicating a favorable valuation outlook [7].