As Chinese equities experience a modest rise, bolstered by the central bank’s supportive measures amid entrenched deflationary pressures, investors are increasingly focusing on stocks that may be trading below their intrinsic value. In this environment, identifying undervalued stocks involves assessing companies with strong fundamentals and growth potential that have been overlooked or underappreciated by the market.
Top 10 Undervalued Stocks Based On Cash Flows In China
|
Name |
Current Price |
Fair Value (Est) |
Discount (Est) |
|
HangzhouS MedTech (SHSE:688581) |
CN¥58.12 |
CN¥108.82 |
46.6% |
|
Beijing Konruns PharmaceuticalLtd (SHSE:603590) |
CN¥23.34 |
CN¥46.03 |
49.3% |
|
Wuhan Keqian BiologyLtd (SHSE:688526) |
CN¥13.81 |
CN¥25.45 |
45.7% |
|
Neusoft (SHSE:600718) |
CN¥10.11 |
CN¥19.29 |
47.6% |
|
Guangdong Skychem Technology (SHSE:688603) |
CN¥87.40 |
CN¥170.04 |
48.6% |
|
Crystal Growth & Energy EquipmentLtd (SHSE:688478) |
CN¥29.56 |
CN¥55.99 |
47.2% |
|
Seres GroupLtd (SHSE:601127) |
CN¥90.82 |
CN¥172.07 |
47.2% |
|
Yangmei ChemicalLtd (SHSE:600691) |
CN¥2.03 |
CN¥3.92 |
48.3% |
|
Ningbo Jifeng Auto Parts (SHSE:603997) |
CN¥13.54 |
CN¥26.00 |
47.9% |
|
Jiangsu Chuanzhiboke Education Technology (SZSE:003032) |
CN¥10.25 |
CN¥19.19 |
46.6% |
Here’s a peek at a few of the choices from the screener.
Overview: Xiamen Amoytop Biotech Co., Ltd. is involved in the manufacture, marketing, and sale of recombinant protein drugs in China with a market cap of CN¥33.85 billion.
Operations: The company’s revenue is primarily generated from its biologics segment, amounting to CN¥2.39 billion.
Estimated Discount To Fair Value: 33.9%
Xiamen Amoytop Biotech shows potential as an undervalued stock based on cash flows, trading at CN¥83.2, below its estimated fair value of CN¥125.92. Its earnings are expected to grow significantly at 30.8% annually, outpacing the Chinese market average. Recent half-year results showed strong revenue and net income growth compared to the previous year, while strategic alliances like the collaboration with Aligos Therapeutics enhance its clinical research capabilities in hepatitis B treatments.
Overview: Range Intelligent Computing Technology Group Company Limited develops data centers and other technology campuses, with a market cap of CN¥56.78 billion.
Operations: The company’s revenue segment includes IDC Services, generating CN¥6.24 billion.
Estimated Discount To Fair Value: 44.1%
Range Intelligent Computing Technology Group is trading at CN¥33, significantly below its estimated fair value of CN¥59.06, highlighting its potential as an undervalued stock based on cash flows. Despite a volatile share price, the company reported substantial revenue and net income growth for the first half of 2024. However, dividends are not well covered by free cash flows and debt coverage by operating cash flow remains inadequate, suggesting areas for financial improvement.
Overview: Imeik Technology Development Co., Ltd. focuses on the research, development, production, and transformation of biomedical soft tissue repair materials in China with a market cap of approximately CN¥66.38 billion.
Operations: Imeik Technology Development Co., Ltd. generates its revenue primarily from the Surgical & Medical Equipment segment, which accounts for CN¥3.07 billion.
Estimated Discount To Fair Value: 20.3%
Imeik Technology Development Ltd. is trading at CN¥220.33, below its estimated fair value of CN¥276.33, suggesting it may be undervalued based on cash flows. The company reported robust revenue and net income growth for the first half of 2024, with earnings rising by 22.8% over the past year. Despite a volatile share price recently, its forecasted revenue growth surpasses market expectations, although earnings are expected to grow slightly slower than the market average.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include SHSE:688278 SZSE:300442 and SZSE:300896.
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