Although companies in China are high-risk speculations, traders may consider three companies. Netease (NTES), a gaming firm, is worth watching. In online retail, look at Alibaba (BABA) and JD.com (JD).
Netease posted an EPADS of $1.66 on revenue of $3.73 billion. The firm ended the quarter with $17.1 billion in cash and cash equivalents. Tencent (TCEHY), whose stock pulled back from $62.57 to $51.65 by the end of last week, is also attractive.
JD.com reported non-GAAP EPADS of $1.24 after revenue increased by 5.1% Y/Y to $37.11 billion. It ended the quarter with $28 billion in cash and cash equivalents. The firm announced a new $5 billion stock buyback that expires at the end of 2027. This is 8% of its shares outstanding, which is close to the 10% limit for a Hong Kong-listed firm.
Alibaba dropped by $1.99 to close at $88.59 after it reported Q2/2025 results. Cash from operations fell by 36% Y/Y to levels not seen since 2018. Adjusted EBITDA also fell by 5% Y/Y.
In the current quarter, the firm may benefit from Singles Day. 11.11 should help Taobao and Tmall perform better sequentially. After the stock downtrend ends, consider trading BABA stock for an eventual rebound.
