Morgan Stanley expects Tencent's third-quarter revenue to increase by 13% year-on-year and reiterates its "Overweight" rating

Morgan Stanley published a research report, expecting Tencent (00700.HK) to achieve a year-on-year revenue growth of 13% in the third quarter, with non-International Financial Reporting Standards operating profit rising by 18%. The gaming and advertising businesses have potential for upward movement, and their profit margins may continue to expand. The bank reiterated its "Overweight" rating on Tencent, with a target price of 700 HKD, continuing to be a preferred stock.

Morgan Stanley raised its non-International Financial Reporting Standards operating profit forecast for Tencent for 2025 to 2027 by 1% to 2%, and expects the company's capital expenditure for 2025 to 2027 to be 320 billion RMB. The bank is optimistic about the company's robust growth across all business areas, as well as positive operating leverage, limited competition, capital management, and execution capabilities