How To Do Quick Research
Let me first start by saying, this is my opinion. Do not go and buy or sell based off of anything that is written and said in this article. These are my personal opinions and my quick checks to see if investing in video games through the market is a smart buy or not.
Due to the Corona Virus we just had a huge correction in the market and almost stock has dropped in value. This means you can now buy in at a lower price than you normally would be able to. So we are going to take a quick and simple dive into what you should look for if you, like me, think video games are the future and want to start investing in them. You can use the 4 four steps I will list to look into other possible positions (stocks) as well as to decide for yourself if the risk will be worth the reward!
Yahoo Finance is a great tool that puts a lot of information into one spot so you can do a quick look. I do have one request if you use Yahoo Finance, please ignore the comments section. Don’t take advice from John or Michael with no last name. I am not saying that they are wrong, but I am saying to do the due diligence yourself and then go to comments to see if anyone else may have the same opinion.
Now go to Yahoo Finance and type in TCEHY in the search bar. You may know them as Tencent.
Step 1: Go to the Max option on the chart.
Notice it is an overall upward trend. Good sign. On the left side of the chart you will see “Volume,” which is sizable. You want a large volume so that if you buy or sell, someone out there will buy it or sell it to you.
Step 2: Read some of the articles below
This will give you some insight to what is going on and what the media is saying about the company. You will notice that right now for Tencent, there has been some restrictions of games it can release in China and that it owns WeChat, which has the biggest social media reach in China. (You may be using it yourself here in the US.) I was able to see all of this without even going into an article, but you should do some digging.
Step 3: Financials Tab
Here is where the reasoning behind the value of the stock is determined. I will give you the most important thing to look at. “NET INCOME AVAILABLE TO COMMON SHAREHOLDERS.” Another thing to consider: How are organizations making money and are they growing? Is the number in parentheses? Then they aren’t making money. Is the Net Income increasing whether they are making money or not? Net Income is a desirable thing. Take the financials in stride with what you just read in the articles.
Step 4: Holders Tab
Don’t let the small percentages fool you, when you see T. Rowe Price, Fischer Asset Management and Vanguard all holding in this position, but you should take notice. These companies, just like everyone, want this stock to blow up, but they are probably in it for the long term and not a get rich quick plan.
Take emotions out of your purchases and see what information those 4 four steps give you.
Here is what they gave me:
Tencent is highly regulated by the Chinese Government. I think that they are being limited in potential because titles that keep being released are either taken down or never allowed on the platform. That is normal for video games in China more or less right now. What I see is if Tencent can break into the US markets even more than they have, they will be given free rein to release whatever they want on their platform in the US. The Nintendo Switch has shown what a handheld device can do and that technology may be transferred and adapted into phones in no time. This basically gives the world the option to be “plugged in” wherever they are and play whatever they want.
You basically already can do that with Fortnite. You can play on your PC or console and then leave in an Uber to get to your friend’s birthday party across town during rush hour (pre or post corona virus of course) and continue the rampage and carnage on your phone. You can download free gaming music from here
I will be the first to admit that I hate gaming on my phone, but sometimes it is the only option, so I do so. Now if someone made a way for me to continue gaming on my phone, and I get to keep being competitive and not sacrifice my gaming style and skill, I would be all over that.
To me, Tencent could be the platform that holds the games and network that we can all potentially plug into to truly bring games and friends with us everywhere we go.
Not to mention they are one of the world’s largest technology, social media, venture capital firm and investment corporation. Plus, they basically own all of China’s music services. They are well diversified, so even if I was wrong about their video game aspect, they seem to have quite a few more revenue streams up their sleeve and won’t be going anywhere soon.
All of this is to basically say: I am personally invested in TCEHY (Tencent Holdings). Remember, assumptions will be made with what information is out there, but the more you know, the more your assumptions could be right!