Tencent's More Than $500B Valuation Surpasses Facebook
Chinese internet firm Tencent Holdings Ltd. has just beaten social media giant Facebook Inc. in market value on Tuesday, placing the video game group on the top five list of the most valuable company.
During Asian trading hours, Tencent’s shares hit a record high of HK$439.6, which raised its market capitalization to HK$4.17 trillion ($533.8 billion), allowing it to surpass Facebook’s valuation of $519.4 billion.
The movement made the Shenzhen-based social network and gaming giant the fifth-most valuable company, as well as the first Asian tech group to be worth more than $500 billion.
Moreover, Tencent was also able to come in ahead of online retailer Alibaba Group Holding Ltd. in the previous day. It is also close to catching up with the $542.7 valuation of Alibaba’s American rival Amazon.com.
Before Tencent’s mark of more than $500 billion, the five most valuable companies were American tech giants, Apple Inc., Alphabet Inc., Facebook Inc., Microsoft Corp., and Amazon.
Tencent’s Stock Supported by Higher Q3 Earnings
Tencent’s upbeat earnings mainly contributed for the surge in its stock, as the success of its smartphone applications, including fantasy rpg Honor of Kings, messaging app WeChat and its video streaming service Tencent Video helped its shares to more than double this year.
It was also the smartphone games that became one of the company’s main profit drivers during the third quarter.
Tencent reported last week that its net profit for the three months ended September was up by 69 percent to CN¥18 billion ($2.71 billion), as its revenue rose 61 percent to CN¥65 billion ($9.8 billion).
Part of that revenue came from its smartphone games as its sales grew by 84 percent to CN¥18.2 billion ($2.74 billion).
Sales director Steven Leung said that Tencent’s growth, as seen on its quarterly results, has supported the rally in its shares, adding that the stock is worth hanging onto despite its current high level.
Tencent’s shares closed in with a 2.3 percent gain to HK$430.00 on Tuesday.