MODEL VERDICT
NetEase, Inc. (NTES)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Popular:
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | MODERATE | 0.70 | $117.98 | CURRENT | — |
| Apr 24, 2026 | MODERATE | 0.70 | $110.58 | CURRENT | — |
| Apr 17, 2026 | MODERATE | 0.70 | $118.20 | CURRENT | — |
| Apr 16, 2026 | MODERATE | 0.70 | $115.81 | CURRENT | — |
| Apr 10, 2026 | MODERATE | 0.70 | $112.72 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 6 analyst estimates | $358.79 | +204.1% | 20% | A- | Analyst Est. |
| EV/EBITDA 3 industry peers | $1439.34 | +1120.0% | 20% | A- | Peer Data |
| Industry Median P/E 2 industry peers | $1602.51 | +1258.3% | 15% | A | Peer Data |
| Price / Free Cash Flow 5 industry peers | $1628.12 | +1280.0% | 15% | B+ | Peer Data |
| EV/EBIT 2 industry peers | $1343.50 | +1038.8% | 8% | B+ | Peer Data |
| EV/FCF 5 industry peers | $1107.82 | +839.0% | 7% | B | Model Driven |
| Peg Ratio 1 industry peers | $1035.16 | +777.4% | 5% | B | Data |
| EV To Revenue 7 industry peers | $618.87 | +424.6% | 4% | B | Data |
| Price / Sales 7 industry peers | $502.82 | +326.2% | 3% | B | Model Driven |
| Earnings Yield 2 industry peers | $1306.14 | +1007.1% | 2% | B | Data |
| FCF Yield 5 industry peers | $1655.28 | +1303.0% | 1% | B | Data |
| Weighted Output Blended model output | $794.81 | +573.7% | 100% | 85 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 12× | 14× | 16× (Current) | 18× | 20× |
|---|---|---|---|---|---|
| Bear Case (9%) | $669 | $780 | $892 | $1003 | $1114 |
| Conservative (15%) | $704 | $821 | $939 | $1056 | $1174 |
| Base Case (23.2%) | $754 | $880 | $1005 | $1131 | $1257 |
| Bull Case (31%) | $804 | $937 | $1071 | $1205 | $1339 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 3.07 | 2.70 | 1.94 | 5.32 | 1.22 |
| EV/EBIT | 2.92 | 2.67 | 0.64 | 5.18 | 1.71 |
| EV/EBITDA | 2.48 | 2.33 | 0.60 | 4.19 | 1.35 |
| P/FCF | 2.32 | 1.95 | 1.54 | 3.14 | 0.65 |
| P/FFO | 2.50 | 2.11 | 1.67 | 4.13 | 0.93 |
| P/TBV | 0.59 | 0.54 | 0.43 | 0.75 | 0.13 |
| P/AFFO | 2.90 | 2.38 | 1.87 | 5.25 | 1.27 |
| P/B Ratio | 0.55 | 0.54 | 0.40 | 0.69 | 0.12 |
| Div Yield | 0.14 | 0.14 | 0.05 | 0.22 | 0.06 |
| P/S Ratio | 0.68 | 0.67 | 0.51 | 0.87 | 0.14 |
Based on our peer multiples analysis with 28 valuation metrics, the model estimates NTES's fair value at $794.81 vs the current price of $117.98, implying +573.7% upside potential. Model verdict: Significantly Undervalued. Confidence: 85/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $794.81 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $661.22 (P10) to $984.30 (P90), with a median of $814.42.
NTES's current P/E of 15.8x compares to the industry median of 31.4x (2 peers in the group). This represents a -49.7% discount to the industry. The historical average P/E is 3.1x over 7 years. Signal: Deep Discount.
32 analysts cover NTES with a consensus rating of Buy. The consensus price target is $149.75 (range: $132.00 — $158.00), implying +26.9% upside from the current price. Grade breakdown: Strong Buy (0), Buy (26), Hold (5), Sell (1), Strong Sell (0).
The model confidence score is 85/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (8), and model agreement (2). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Margin reversion: Current net margin of 30.0% is 6.3 percentage points above the 7-year average (23.7%), with a Z-score of +1.2σ. If margins normalize, fair value could drop to ~$124. (2) Multiple compression: NTES trades at the 5000th percentile of its historical P/E range. A reversion to median (3.1×) would imply significant downside. (3) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that NTES's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +1.2σ, meaning margins are 1.2 standard deviations above their historical average. If margins revert to the 7-year mean (23.7%), the model estimates fair value drops by 470.0% to approximately $124. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.