Purchase 30 stocks Tencent

Tencent Corporate Logo

Normally I tend to place my monthly stock purchase at the end of the month just after I received my salary. This month I’m early. I planned to buy this month Tencent (NNND)stocks and I placed a limit order almost 5% below the current price. Last days the price of Tencent dropped and I got 30 shares at a price of €34,86 at the Frankfurt exchange.

Tencent is not really a dividend stock, so not a regular stock pick for me. This buy is more a purchase against the current sentiment in the market which is negative for Tencent. Tencent is down 30% from it’s highest price this year. I have Tencent a long time on my watchlist, because it’s a company with a strong position in China. Tencent has a strong moat in China with the WeChat app. The Chinese market is still difficult to enter by foreign companies so it’s my opinion that Tencent won’t experience any competition from Facebook or Alphabet on their homemarket.

The advantage is possibly also a weakness. The Chinese government is softly said not a big fan of the gaming market and lately Beijing is restricting gaming approvals. Near-term there are regulatory challenges in China, but for longer term overall industry growth prospects within Asia are very solid.

With the purchase of Tencent stocks I gain more exposure to Technology and China exposure.

Tencent payed a dividend of HK$0.88 per share over 2017. This is approximately €0.10 per share. As a result of purchasing 30 Tencent shares my yearly expected dividend income will increase with €3,00. The yield on cost based on the current dividend is 0,29%.

2 thoughts on “Purchase 30 stocks Tencent”

  1. Companies like Tencent are usually not on my radar, too, as I’m more of a dividend growth investor just like you.

    However, Tencent’s business model still looks very promising to me and the recent price drop makes me wonder, if we should initiate a small position as well. I guess the same goes for Alibaba (also at 52-week low).

    What do you think? Is Alibaba on your radar, too?

    – David

    1. Funny that you ask about BABA. I today bought 10 shares. It’s not a typical purchase for me again as div growth investor, but I believe that part of my portfolio should have exposure to more speculative and volatile (growth) companies like Amazon, Tencent and Alibaba.

      For myself I did write down as guideline to have a maximum of 10% of my portfolio invested in growth stocks like Amazon, Tencent, Facebook, Alibaba, etc. With my Alibaba purchase of today I’m at 8% exposure so below my own guideline. For many 10% is probably still conservative, but for me it’s fine.

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