<div id="readability-page-1" class="page"><div>NTES-S (09999.HK) +6.400 (+3.381%) Short selling $615.21M; Ratio 26.152% opened 4.49% higher today (27th), hitting an intraday high of HKD198.1. It last traded at HKD196.1, up 3.59%, with turnover of 4.8611 million shares, involving HKD955 million.M Stanley said in a research report that NetEase, Inc. is gaining market share on the back of its leading development capabilities and expanding globally through in-house studios and collaborations with industry veterans. The broker believes that the overseas revenue performance of Fantasy Westward Journey Mobile and Yanyun Sixteen Voices has been strong, which should help offset the high base effect in the coming two quarters due to a limited pipeline of new game launches.M Stanley maintained an Overweight rating on NetEase, Inc., citing continued growth in gaming revenue driven by evergreen titles and potential upside from new game launches. The broker raised its net profit forecasts for 2026 to 2028 by 2.2%, 4.3% and 5.2%, respectively, mainly reflecting stronger gross margins in 1Q26 results and better operating expense management.Based on the earnings forecast revision, the broker lifted its TP on NetEase, Inc. (NTES.US) by 2% from USD154 to USD158. The bull-case and bear-case TPs are USD191 and USD106, respectively.------------------------------------------------------------------------------------------------------------- JPM said in a research report that it reiterated NetEase, Inc. as its top pick in the digital entertainment sector. It raised the TP for NTES-S (09999.HK) +6.400 (+3.381%) Short selling $615.21M; Ratio 26.152% to HKD290 from HKD280, and the TP for NetEase, Inc. (NTES.US) to USD185 from USD180, with an Overweight rating. The upward revision was mainly due to a 2% increase in its 2026 EPS forecast, reflecting improved margins of existing games.JPM turned more positive on NetEase, Inc.'s gaming outlook after its 1Q26 results. Gaming revenue rose 7% YoY and 18% QoQ in 1Q26, beating expectations despite no new game launches during the period and a high base a year earlier. Revenue from Yanyun Sixteen Voices reached a record high and outperformed Steam traffic data, indicating that many players used NetEase's official game launcher. Meanwhile, the Fantasy Westward Journey franchise remained robust. More than a decade after the PC version was launched, peak concurrent users reached a new high of 9 million, and the game recorded its highest quarterly revenue in 1Q26. The mobile version also hit a record high in daily active users.At the same time, NetEase, Inc.'s margins expanded significantly. Gross margin of its games and related value-added services reached a record high of 75%, up 600 bps YoY and 430 bps QoQ, benefiting from a higher contribution from PC and cross-platform games and a lower revenue-sharing ratio with mobile app stores. The broker believes there is further room for gross margin expansion.JPM expected gaming revenue growth to accelerate to 8% in 2Q26 due to a lower base in 2Q last year. It forecast that new title Sea of Remembrance will launch in 3Q26, driving gaming revenue growth to accelerate to 11% and 16% in 3Q26 and 4Q26, respectively. The game will begin its final closed beta test on May 28. JPM currently estimates the game's annual cash GGR could reach RMB5 billion.The broker noted that NetEase, Inc. is currently trading at about 12x forecast 2026 PE, which it considers attractive, with operating profit CAGR of 19% for 2026 to 2027. Key catalysts include the launch of Sea of Remembrance in 3Q26 and potential inclusion in Stock Connect.</div></div>

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NTES-S (09999.HK) rose over 3% after M Stanley and JPM raised their target prices. M Stanley increased its target price for NetEase, Inc. to USD158, citing strong overseas revenue and growth in gaming. JPM raised its target price to HKD290, highlighting improved margins and positive gaming outlook. Both firms maintained Overweight ratings, with expectations of continued revenue growth and upcoming game launches.

- NetEase, Inc. (09999.HK) opened 4.49% higher and last traded at HKD196.1, with favorable earnings forecasts prompting target price increases from brokerage firms.  
- Morgan Stanley raised its profit forecasts for 2026-2028, citing improved margins and a strong pipeline from existing and upcoming game titles, while JPM also reiterated its Overweight rating with increased target prices following solid 1Q26 results.  
- Both firms highlight robust gaming revenue performance and further margin expansion potential, with continued growth expected, particularly from the launch of the new game "Sea of Remembrance."

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JPMORGAN CHASE & CO. 4.20% DEP SHS REPSTG 1/400TH PFD SER MM

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JPMorgan Chase & Co.

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NTES-S  Rises Over 3% as M Stanley and JPM Raise TP