First Shanghai Securities·2025-12-09 10:43Group 1: Company Research - NetEase - NetEase's Q3 deferred revenue increased by 25% year-on-year, reaching 194.7 billion CNY[6] - Q3 revenue was 28.36 billion CNY, an 8.2% increase year-on-year, but below Bloomberg consensus of 29.22 billion CNY[6] - GAAP net profit for Q3 was 8.79 billion CNY, a 31.8% increase year-on-year, while Non-GAAP net profit was 9.50 billion CNY, a 26.7% increase[6] - The company expects game and related service revenue to grow by 12.4% year-on-year, reaching 94 billion CNY in 2025[7] Group 2: Valuation and Ratings - The target price for NetEase is set at 165.00 USD/256.74 HKD, representing an upside of 18.04% in the US market and 18.42% in the HK market[10] - The estimated revenue CAGR for NetEase from 2025 to 2027 is 12.9%, with Non-GAAP net profit CAGR at 15.5%[10] - The company maintains a "Buy" rating based on a PEG of 1.5 for its gaming business, corresponding to a PE of 19[10] Group 3: Company Research - Netflix - Netflix announced the acquisition of Warner Bros. Discovery's film studio and streaming business for 72 billion USD, with an enterprise value of 82.7 billion USD[23] - The combined user base of Netflix and HBO Max is approximately 400 million, but overlapping users may limit growth potential[26] - The acquisition is expected to enhance Netflix's content library, particularly with iconic IPs from HBO, which could improve user engagement and pricing power[25]