Morningstar analyst Ivan Su stated in a research report that Tencent's stock price remains significantly undervalued. The analyst noted that Tencent's stock price gained upward momentum following the recent market enthusiasm for Meta's AI agent application, Muse. Su said investors see Muse's popularity as a positive sign for Tencent, as the company is testing a similar AI agent, "Xiaowei," within WeChat. He believes Xiaowei has a structural advantage over Muse because it is integrated into WeChat, the most widely used application in China, while Muse is a standalone download. However, Tencent's stock price is currently trading at a discount of approximately 40% to Morningstar's target price of HK$780. "A successful launch of the AI agent (potentially later this year) could be a catalyst for the stock price," he added.
