Why Did NetEase Move Higher After a Bad Report?
The headlines haven't been kind to NetEase (NASDAQ: NTES) this week. We woke up on Monday with news that China was cracking down on the amount of time that minors can play online games in the country, a pretty big deal since gaming represents the lion's share of NetEase's business.
NetEase went on to post its second-quarter results after Monday's market close, and it was another nugget of unimpressive news. Net revenue rose 13% to $3.2 billion for the three months ending in June, in line with expectations. However, earnings per share fell to $0.98 on an adjusted basis, below what analysts were expecting and below the $1.25 a share it posted a year earlier.
NetEase has missed Wall Street's profit targets in two of the past three quarters. And now, regulators are making it harder for NetEase to do business on two fronts. However, the stock still managed to be one of Tuesday's biggest winners with a 9% gain. Let's take a closer look at why NetEase stock bucked the bad news during an earnings season when even companies delivering blowout results have come undone.
Source Fool.com
