Tencent (OTCMKTS:TCEHY – Get Free Report) and Phoenix New Media (NYSE:FENG – Get Free Report) are both communication services companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, earnings, risk, valuation, institutional ownership and profitability.
Insider & Institutional Ownership
0.0% of Tencent shares are owned by institutional investors. Comparatively, 6.3% of Phoenix New Media shares are owned by institutional investors. 10.9% of Phoenix New Media shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Profitability
This table compares Tencent and Phoenix New Media’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Tencent | 29.83% | 19.98% | 12.03% |
| Phoenix New Media | 3.62% | 2.78% | 1.87% |
Risk & Volatility
Analyst Ratings
This is a breakdown of current ratings and recommmendations for Tencent and Phoenix New Media, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Tencent | 1 | 1 | 2 | 0 | 2.25 |
| Phoenix New Media | 1 | 0 | 0 | 0 | 1.00 |
Tencent currently has a consensus price target of $106.00, indicating a potential upside of 96.66%. Given Tencent’s stronger consensus rating and higher probable upside, research analysts clearly believe Tencent is more favorable than Phoenix New Media.
Earnings & Valuation
This table compares Tencent and Phoenix New Media”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Tencent | $104.58 billion | 4.69 | $31.28 billion | $3.65 | 14.77 |
| Phoenix New Media | $828.75 million | 0.02 | $50,000.00 | $0.36 | 3.99 |
Tencent has higher revenue and earnings than Phoenix New Media. Phoenix New Media is trading at a lower price-to-earnings ratio than Tencent, indicating that it is currently the more affordable of the two stocks.
Summary
Tencent beats Phoenix New Media on 12 of the 14 factors compared between the two stocks.
About Tencent
Tencent Holdings Limited, an investment holding company, offers value-added services (VAS), online advertising, fintech, and business services in the People's Republic of China and internationally. It operates through VAS, Online Advertising, FinTech and Business Services, and Others segments. The company's consumers business provides communication and services, such as instant messaging and social network; digital content including online games, videos, live streaming, news, music, and literature; fintech services, which includes mobile payment, wealth management, loans, and securities trading; and various tools, such as network security management, browser, navigation, application management, email, etc. Its enterprise business comprises marketing solutions, which offers digital tools including user insight, creative management, placement strategy, and digital assets management; and cloud services, such as cloud computing, big data analytics, artificial intelligence, Internet of Things, security and other technologies for financial services, education, healthcare, retail, industry, transport, energy, and radio & television application. In addition, the company operates innovation business, which includes artificial intelligences; and discover and develops enterprise and next-generation technologies for food production, energy, and water management application. Tencent Holdings Limited was formerly known as Tencent (BVI) Limited and changed its name to Tencent Holding Limited in February 2004. The company was founded in 1998 and is headquartered in Shenzhen, the People's Republic of China.
About Phoenix New Media
Phoenix New Media Limited provides content on an integrated Internet platform in the People's Republic of China. The company operates through two segments, Net Advertising Services and Paid Services. It offers content and services through PC channel, mobile channel, and telecom operators, as well as transmits content to TV viewers, primarily through Phoenix TV. The company, through its website, ifeng.com, provides various interest-based content verticals, such as news, finance, video, automobiles, technology, entertainment, military, real estate, fashion, and sport; and offers interactive services, including comments posting and user surveys. Its mobile channel consists of ifeng News, a news application that provides newsfeeds and other contents in the form of text, image, live streaming, and video; ifeng Video, a video application, which offers video news, live broadcasting, Phoenix TV programs content, etc.; i.ifeng.com mobile Internet website; and digital reading applications. In addition, Phoenix New Media Limited offers mobile newspaper, mobile video, and mobile game services, as well as wireless value-added services. The company was incorporated in 1998 and is headquartered in Beijing, the People's Republic of China. Phoenix New Media Limited is a subsidiary of Phoenix Satellite Television (B.V.I.) Holding Limited.
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