Is NetEase (NTES) Stock Outpacing Its Computer and Technology Peers This Year?

The Computer and Technology group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. NetEase (NTES) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Computer and Technology peers, we might be able to answer that question.

NetEase is one of 605 companies in the Computer and Technology group. The Computer and Technology group currently sits at #2 within the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.

The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. NetEase is currently sporting a Zacks Rank of #2 (Buy).

Over the past three months, the Zacks Consensus Estimate for NTES' full-year earnings has moved 0.4% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.

Based on the most recent data, NTES has returned 55.9% so far this year. Meanwhile, the Computer and Technology sector has returned an average of 29.3% on a year-to-date basis. This means that NetEase is performing better than its sector in terms of year-to-date returns.

One other Computer and Technology stock that has outperformed the sector so far this year is AXT (AXTI). The stock is up 237.3% year-to-date.

The consensus estimate for AXT's current year EPS has increased 3.2% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Breaking things down more, NetEase is a member of the Internet - Software and Services industry, which includes 10 individual companies and currently sits at #145 in the Zacks Industry Rank. Stocks in this group have gained about 33.5% so far this year, so NTES is performing better this group in terms of year-to-date returns.

In contrast, AXT falls under the Electronics - Semiconductors industry. Currently, this industry has 45 stocks and is ranked #74. Since the beginning of the year, the industry has moved +49.5%.

Investors with an interest in Computer and Technology stocks should continue to track NetEase and AXT. These stocks will be looking to continue their solid performance.

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This article originally published on Zacks Investment Research (zacks.com).

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