'It's only a matter of time': why analysts expect Tencent shares to return to record highs

Shares of Chinese internet giant Tencent could soon return to all-time highs, analysts at banks and investment firms have suggested. Although the tech company's market value has grown by more than $180 billion in 2025, its shares are still trading 21% below their peak. Investor optimism is fueled by the company's relatively low valuation, record-high profit forecasts and expectations from the launch of new video games, Bloomberg writes.

The stock's return to record highs is "just a matter of time," according to GAM Investment Management fund manager Jian Shi Cortesi. Tencent is the largest asset in GAM's flagship fund. Cortesi believes the widespread adoption of messenger WeChat will provide Tencent with long-term leadership in e-commerce, and calls the current stock valuation "reasonable" compared to historical performance and competitors.

Morningstar analyst Ivan Su also said, "I have no doubt that Tencent will return to historical levels." He believes that the market has not yet fully factored in the positive impact of artificial intelligence on the company's advertising and gaming businesses, but is confident that "these revisions [to] earnings forecasts will eventually happen."

Polen Capital's portfolio manager Jun Liu believes it's worth keeping a close eye on Tencent's performance in the advertising business first, "especially if its AI efforts help accelerate growth in video subscribers." She added that its diversified portfolio of businesses makes Tencent "more protected than competitors from factors such as duties and macroeconomic uncertainty."

Goldman Sachs noted that the market is looking forward to the launch of the mobile version of the Valorant video game, scheduled for next week. The bank predicts the game will be Tencent's revenue driver from the second half of this year to the first half of 2026. Goldman analyst Ronald Keung said in a note that the Delta Force shooter, released in early 2025 by one of Tencent's internal studios, "becomes a potential franchise-level evergreen game."

In 2022, Tencent was hit hard by anti-monopoly regulation in China, which caused its shares to fall to a five-year low. Since the beginning of 2025, the company's quotations have risen by 39%: on the one hand, Tencent has not benefited from the boom in artificial intelligence as much as its competitor Alibaba, but on the other hand - it has not suffered from stiff competition like Meituan, notes Bloomberg.

Now Tencent shares are traded with a P/E ratio (ratio of price to expected earnings per share) of 18 - slightly below the average value for the last five years. By comparison, shares of Meta Platforms and Sony are trading with a P/E above 22, and securities of Japanese mobile video game maker Nintendo - with a P/E of almost 40, the agency emphasizes. Quotes of each of these competitors of Tencent recently updated records.

The majority of Wall Street analysts do not doubt the attractiveness of Tencent shares at the current price: according to FactSet, 54 economists recommend to buy securities of the Chinese holding (ratings Buy and Overweight), four advise to hold them (Hold) and only one - to sell (Sell).

This article was AI-translated and verified by a human editor