ZKH Group (NYSE:ZKH) & Tencent (OTCMKTS:TCEHY) Head-To-Head Survey

Tencent (OTCMKTS:TCEHY) and ZKH Group (NYSE:ZKH) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, risk, analyst recommendations, profitability, dividends, earnings and valuation.

Profitability

This table compares Tencent and ZKH Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tencent	29.92%	18.98%	11.39%
ZKH Group	-1.54%	-4.64%	-2.19%

Insider & Institutional Ownership

0.0% of Tencent shares are held by institutional investors. Comparatively, 9.5% of ZKH Group shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Tencent and ZKH Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tencent	0	2	2	0	2.50
ZKH Group	1	0	0	0	1.00

Tencent presently has a consensus price target of $102.00, indicating a potential upside of 66.67%. Given Tencent’s stronger consensus rating and higher possible upside, equities analysts clearly believe Tencent is more favorable than ZKH Group.

Volatility & Risk

Tencent has a beta of 0.29, indicating that its stock price is 71% less volatile than the S&P 500. Comparatively, ZKH Group has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500.

Earnings and Valuation

This table compares Tencent and ZKH Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tencent	$104.58 billion	5.34	$31.28 billion	$3.38	18.11
ZKH Group	$8.99 billion	0.05	-$19.98 million	($0.13)	-23.62

Tencent has higher revenue and earnings than ZKH Group. ZKH Group is trading at a lower price-to-earnings ratio than Tencent, indicating that it is currently the more affordable of the two stocks.

Summary

Tencent beats ZKH Group on 11 of the 13 factors compared between the two stocks.

About Tencent

Tencent Holdings Limited, an investment holding company, offers value-added services (VAS), online advertising, fintech, and business services in the People's Republic of China and internationally. It operates through VAS, Online Advertising, FinTech and Business Services, and Others segments. The company's consumers business provides communication and services, such as instant messaging and social network; digital content including online games, videos, live streaming, news, music, and literature; fintech services, which includes mobile payment, wealth management, loans, and securities trading; and various tools, such as network security management, browser, navigation, application management, email, etc. Its enterprise business comprises marketing solutions, which offers digital tools including user insight, creative management, placement strategy, and digital assets management; and cloud services, such as cloud computing, big data analytics, artificial intelligence, Internet of Things, security and other technologies for financial services, education, healthcare, retail, industry, transport, energy, and radio & television application. In addition, the company operates innovation business, which includes artificial intelligences; and discover and develops enterprise and next-generation technologies for food production, energy, and water management application. Tencent Holdings Limited was formerly known as Tencent (BVI) Limited and changed its name to Tencent Holding Limited in February 2004. The company was founded in 1998 and is headquartered in Shenzhen, the People's Republic of China.

About ZKH Group

ZKH Group Limited develops and operates a maintenance, repair, and operating (MRO) products trading and service platform that offers spare parts, chemicals, manufacturing parts, general consumables, and office supplies in the People’s Republic of China. The company provides MRO procurement and management services; digitalized MRO procurement solutions; and logistics and warehousing services. It also engages in the production and sale of intelligent warehousing equipment. ZKH Group Limited was founded in 1998 and is based in Shanghai, the People’s Republic of China.