Chinese online portal and game publisher NetEase (NTES) has scored another hit mobile video game in “Yin and Yang Shi.”
“Download volume suggests strong traction for NetEase’s recently launched mobile game ‘Yin and Yang Shi,’ ” M Science analyst Henry Guo said in a research report Tuesday. “While it is unlikely the mobile game would have significant financial impact on the company’s Q3 ’16 top line, we strongly believe it could become a material revenue contributor in Q4 ’16 and beyond.”
U.S. shares of NetEase fell 2.8% to 254.16 on the stock market today. NetEase, up 40% this year, hit an all-time high of 262.72 on Monday.
IBD’S TAKE: NetEase sports a best-possible IBD Composite Rating of 99. It is ranked No. 1 on the IBD 50 list of superior stocks.
“Yin and Yang Shi” is a role-playing game based on folk stories from Japan’s Edo period. The game became available for download the week of Sept. 2 on Apple‘s (AAPL) iOS store and launched on Android stores on Sept. 9.
“The game has the potential to become a blockbuster,” Guo said.
Downloads in the first two weeks set a record for NetEase, excluding its two flagship mobile games “Westward Journey Online” and “Fantasy Westward Journey,” he said.
“Initial feedback from game players suggests high-quality design of characters, storylines and scenes,” Guo said. “Within the game, NetEase adds location and social elements to help establish a strong community to enhance interactions between game players both online and offline.”
In addition, the game is important for NetEase’s plans to expand into Japan and Southeast Asia, he said.
NetEase develops its own games and also distributes games in China from Activision Blizzard (ATVI).
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