Barclays starts bullishly on Tencent Music for its leading position as 'Spotify of China'
Spencer Platt Barclays initiated Chinese music streaming service Tencent Music Entertainment (NYSE:TME) with an \"overweight\" rating on Wednesday after being encouraged by its dominant market share as the \"Spotify of China.\" The research firm said the company boasts an \"impressive track record\" of adapting and improving in a challenging market and noted that it has also scaled down its live streaming business, which was subject to a lot of regulatory scrutiny, all while maintaining a stable and growing overall revenue base. Barclays pointed out that recent changes in operational focuses at the company scared the market, but the research firm views the response as an \"overreaction\" and continued to express confidence in the management's execution strategy. Due to its proven track record, Tencent Music, which owns three of the five major online music apps in China, is \"a compelling asset to own,\" says Barclays. TME has a PT set at $16, implying an upside of 38%.
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