Tencent Falls On New Gaming Restrictions: Assessing The Impact

Lintao Zhang Tencent (OTCPK:TCEHY) was falling double-digits in Friday trading after the Chinese government announced new rules cracking down on online gaming. In this report, I analyze the potential financial fallout from such regulation, as well as any potential impact on the valuation. TCEHY remains a dominant Chinese tech titan with positive cash flow generation and a solid balance sheet. Prior to this online gaming announcement, TCEHY was positioned for operating leverage, as management has committ ...