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NetDragon Websoft Holdings
(0777)
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Rating:52Neutral
Price Target:
HK$8.50
Action:Reiterated
Date:08/06/26
The score is held back primarily by weakening financial performance, including declining revenue, sharply lower net income, and a significant drop in operating and free cash flow, alongside rising leverage and much lower ROE. Offsetting factors include mildly improving short-term technical momentum and a very high dividend yield, though the P/E remains moderate relative to the recent profitability downshift.
Positive Factors
Strong Gross Margin
A gross margin near 70% indicates the company retains substantial value after direct costs, supporting reinvestment in game development, live content, and education products. This provides a durable operating foundation even though weaker revenue and below-gross-profit expenses currently limit overall profitability.
Negative Factors
Sustained Revenue Decline
The sharp multi-year revenue decline signals weakening scale across the company’s operating activities rather than a single quarterly fluctuation. Lower revenue can reduce the ability to spread fixed costs, constrain investment in new products, and make a durable recovery in earnings more difficult.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Gross Margin
A gross margin near 70% indicates the company retains substantial value after direct costs, supporting reinvestment in game development, live content, and education products. This provides a durable operating foundation even though weaker revenue and below-gross-profit expenses currently limit overall profitability.
Read all positive factors
NetDragon Websoft Holdings (0777) vs. iShares MSCI Hong Kong ETF (EWH)
Market Cap
HK$4.49B
Dividend Yield11.83%
Average Volume (3M)1.34M
Price to Earnings (P/E)24.3
Beta (1Y)0.99
Revenue Growth-15.56%
EPS GrowthN/A
CountryHK
Employees3,061
SectorConsumer Goods
Sector StrengthN/A
IndustryElectronic Gaming & Multimedia
Share Statistics
EPS (TTM)0.30
Shares Outstanding531,262,500
10 Day Avg. Volume2,125,971
30 Day Avg. Volume1,339,173
Financial Highlights & Ratios
PEG Ratio-0.64
Price to Book (P/B)0.92
Price to Sales (P/S)1.11
P/FCF Ratio17.67
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
HK$11.50Price Target Upside― Downside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.8
Revenue Forecast (FY)HK$4.35B
NetDragon Websoft Holdings Business Overview & Revenue Model
Company Description
NetDragon Websoft Holdings Limited functions as an investment umbrella, with its core business centered on the development and operation of online and mobile games across a global footprint, including China, the United States, and the United Kingd...
How the Company Makes Money
NetDragon primarily earns revenue through two main operating segments: (1) Online games and (2) Digital education.
1) Online games (game development and operations)
- Game-based monetization: The company generates income by publishing and operati...
NetDragon Websoft Holdings Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
63
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.16B | 4.47B | 6.05B | 7.10B | 7.87B | 7.04B |
| Gross Profit | 2.93B | 3.15B | 3.94B | 4.40B | 4.32B | 4.52B |
| EBITDA | 583.14M | 740.00M | 1.01B | 1.32B | 1.55B | 1.79B |
| Net Income | 156.50M | 151.00M | 311.00M | 550.00M | 834.00M | 1.06B |
Balance Sheet | ||||||
| Total Assets | 9.30B | 9.94B | 10.43B | 10.38B | 11.03B | 10.88B |
| Cash, Cash Equivalents and Short-Term Investments | 3.62B | 4.07B | 2.90B | 2.61B | 3.99B | 4.35B |
| Total Debt | 2.11B | 2.85B | 2.55B | 1.77B | 2.19B | 1.65B |
| Total Liabilities | 4.14B | 4.55B | 4.57B | 4.21B | 4.43B | 3.81B |
| Stockholders Equity | 5.27B | 5.44B | 5.83B | 5.89B | 6.90B | 7.32B |
Cash Flow | ||||||
| Free Cash Flow | 177.78M | 281.52M | 886.00M | 493.00M | 901.00M | 883.00M |
| Operating Cash Flow | 341.26M | 422.77M | 1.05B | 1.11B | 1.07B | 1.03B |
| Investing Cash Flow | -685.70M | -1.11B | -875.00M | -915.00M | -106.00M | -839.00M |
| Financing Cash Flow | -761.03M | -248.40M | 130.00M | -1.70B | -1.02B | -544.00M |
NetDragon Websoft Holdings Technical Analysis
Positive
―
Price Trends
7.59
Positive
7.95
Positive
8.78
Negative
Market Momentum
<0.01
Negative
61.97
Neutral
83.25
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0777, the sentiment is Positive. The current price of undefined is equal to the 20-day moving average (MA) of 7.67, equal to the 50-day MA of 7.59, and equal to the 200-day MA of 8.78, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 61.97 is Neutral, neither overbought nor oversold. The STOCH value of 83.25 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0777.
NetDragon Websoft Holdings Peers Comparison
UnderperformOutperform
Sector (57)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
57 Neutral | $3.13B | 9.23 | -34.32% | 3.14% | -25.56% | -353.61% |
* Consumer Goods Sector Average
Performance Comparison
NetDragon Websoft Holdings Corporate Events
NetDragon Flags Mynd.ai’s H1 2026 Unaudited Results Filing With U.S. SEC
Aug 27, 2026
NetDragon Websoft Holdings Limited is a Hong Kong-listed technology group incorporated in the Cayman Islands, with business interests that include its non-wholly owned U.S.-listed subsidiary Mynd.ai, Inc. Mynd.ai’s shares are traded on the N...
NetDragon Leans Into AI as Gaming IPs Rebound and Dividend Rises
Aug 27, 2026
NetDragon Websoft Holdings reported resilient interim performance for the six months ended 30 June 2026, underpinned by the debut of its moyu AI workforce ecosystem at the Global Smart Education Conference as a key step in transforming into a true...
NetDragon Websoft Declares HKD 0.5 Interim Dividend for 2026 Half-Year
Aug 27, 2026
NetDragon Websoft Holdings Limited has declared an interim ordinary cash dividend of HKD 0.5 per share for the six months ended 30 June 2026, for the financial year ending 31 December 2026. The ex-dividend date is set for 9 September 2026, with th...
NetDragon Schedules Board Meeting to Approve 2026 Interim Results and Consider Dividend
Aug 12, 2026
NetDragon Websoft Holdings has scheduled a board meeting for 27 August 2026 to review and approve the unaudited consolidated interim financial results for the six months ended 30 June 2026, and to authorize their release on the company and Hong Ko...
NetDragon Details Share Award Grant to Executive Director in Annual Report Update
Aug 11, 2026
NetDragon Websoft Holdings has disclosed supplemental information to its 2025 annual report, detailing a grant of 360,000 share awards to executive director Dr. Leung Lim Kin Simon under its 2024 Share Award Scheme. The award, granted at no purcha...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.