Analyzing TENCENT HOLDING/ADR (OTCMKTS:TCEHY) and Slack (OTCMKTS:WORK)

Slack (NYSE:WORK) and TENCENT HOLDING/ADR (OTCMKTS:TCEHY) are both large-cap business services companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Dividends

TENCENT HOLDING/ADR pays an annual dividend of $0.11 per share and has a dividend yield of 0.3%. Slack does not pay a dividend. TENCENT HOLDING/ADR pays out 10.8% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Slack and TENCENT HOLDING/ADR’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Slack $400.55 million 35.30 -$140.68 million N/A N/A
TENCENT HOLDING/ADR $45.21 billion 8.79 $11.89 billion $1.02 40.79

TENCENT HOLDING/ADR has higher revenue and earnings than Slack.

Insider & Institutional Ownership

19.4% of Slack shares are held by institutional investors. Comparatively, 0.4% of TENCENT HOLDING/ADR shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Slack and TENCENT HOLDING/ADR’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Slack N/A N/A N/A
TENCENT HOLDING/ADR 26.22% 19.12% 9.64%

Analyst Ratings

This is a summary of recent ratings and price targets for Slack and TENCENT HOLDING/ADR, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Slack 0 8 9 0 2.53
TENCENT HOLDING/ADR 0 1 7 0 2.88

Slack presently has a consensus target price of $36.44, suggesting a potential upside of 40.20%. TENCENT HOLDING/ADR has a consensus target price of $227.00, suggesting a potential upside of 445.54%. Given TENCENT HOLDING/ADR’s stronger consensus rating and higher possible upside, analysts clearly believe TENCENT HOLDING/ADR is more favorable than Slack.

Summary

TENCENT HOLDING/ADR beats Slack on 8 of the 12 factors compared between the two stocks.

Slack Company Profile

Slack Technologies, Inc. operates Slack, a business technology software platform in the United States and internationally. Its platform brings together people, applications, and data, as well as sells its offering under a software-as-a-service model. The company was formerly known as Tiny Speck, Inc. and changed its name to Slack Technologies, Inc. in 2014. Slack Technologies, Inc. was founded in 2009 and is headquartered in San Francisco, California.

TENCENT HOLDING/ADR Company Profile

Tencent Holdings Limited, an investment holding company, provides Internet value-added services (VAS) and online advertising services in Mainland China, Hong Kong, North America, Europe, other Asian countries, and internationally. The company operates through VAS, Online Advertising, and Others segments. It offers online games and social networks across various online platforms; online advertising services, such as media, social, and display-based advertising services; and FinTech, cloud, television series and film production, and other services for individual and corporate users. The company also develops software; develops and operates online games; and provides information technology, information system integration, asset management, online literature, and online music entertainment services. The company was founded in 1998 and is headquartered in Shenzhen, the People's Republic of China.

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