Tencent Music Stock Rises 4% After Macquarie Sets Target of $19.50
The brokerage firm set a price target 22 percent higher than HSBC and JPMorgan.
Shares in Tencent Music Entertainment Group (NYSE: TME) jumped 4 percent Tuesday morning after Macquarie Group initiated coverage of the company with "outperform."
The brokerage started with a target of $19.50 per American depositary share for the music arm of the Chinese giant Tencent Holdings Ltd. (HKEX: 0700). That implied an upside of 30 percent to yesterday's close and was 22 percent higher than the target of $16 per share that HSBC Group and JPMorgan & Co. issued on the company in January.
Macquarie's rating sent the stock of Tencent Music to $15.64 per ADS, up 64 cents, in the first hours of trading today.
The Chinese music giant debuted in New York in December, raising $1.1 billion after pricing its shares at $13 apiece. Its ceiling since has been $15.76 per share.
The IPO was one of the largest by a Chinese company in the United States in 2018, behind the $2.4 billion raised by video streaming company iQiyi Inc. (Nasdaq: IQ) in March and the $1.6 billion garnered by online group discounter Pinduoduo (Nasdaq: PDD) in July.
The company was formed in 2016 when its parent purchased China Music Corp., the owner of Kugou and Kuwo, for $2.7 billion. It subsequently merged with QQ Music, a music platform Tencent launched in 2003. Also under its control is WeSing, Tencent's online social karaoke platform launched in 2014. Tencent Music now operates China's biggest music streaming apps.