Shares of Tencent Music Entertainment Group (NYSE:TME), a China-based streaming music company, jumped sharply on Tuesday. The stock was up about 19% as of noon EST.
The tech stock's sharp rise follows two analysts' 12-month price target upgrades for Tencent Music shares this morning.
Oppenheimer analyst Bo Pei and Citi analyst Alicia Yap set 12-month price targets for Tencent Music of $28 and $26 on Tuesday. These figures are up from their previous targets of $20 and $19, respectively.
In Yap's note to investors on Tuesday, she explained that she thinks the quality of Tencent Music's earnings is improving as its revenue shifts toward online music subscriptions and higher-margin advertising. In addition, Yap cites opportunity in long-form audio content.
The two price target upgrades follow Tencent Music's announcement on Friday that it has agreed to acquire Lazy Audio, a streaming music platform for long-form content like audiobooks.
"Lazy Audio's catalog is set to expand our audio content library, and its recording capacity will significantly boost our production of audiobooks," Tencent Music CEO Cussion Pang said in a press release about the deal.