Naspers: Chance to gain access to the gaming industry
Many of the Naspers perma-bulls seem to be starting to lose hope
Naspers has been one of those "love to hate" stocks, especially in recent times, as the share has pulled back about 21% from the record highs it reached in November last year.Many of the Naspers perma-bulls seem to be starting to lose hope. This erosion of confidence — and of the share price — is of course exacerbated by a recent drop in earnings below what the market was expecting for Tencent, as well as some regulatory headwinds faced by Tencent’s gaming business in China.The internet giant is Naspers’s biggest investment, through earnings rights to just over 30% of it.Ironically, the two issues mentioned above are related.Tencent’s earnings were lower because regulators put a freeze on the selling of new items and on other in-game or in-app purchases.Gaming is a huge industry, generating 48% of Tencent’s profit, and it is set to expand much further.For some perspective on just how big it is, compare it to the third-largest gaming company in the world, Activision Blizzard (in whic...
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