China is the world’s second-largest economy (with the largest population in the world), aiming to be the tech leader in the future from telecommunications to artificial intelligence. It is known as ‘a sleeping tiger’ with lots of potentials. There have been several predictions that China will overtake the U.S as the world’s top economy in 2032 mainly because of its unstoppable economic rise over the past years. Famed investors like Charlie Munger have stated that Chinese companies are stronger and growing faster than American companies. With that being said, it might be good to start considering investing in Chinese stocks. Here is a list of some amazing and high-growth Chinese stocks that you might be interested in.
JD.com, Inc. (JD)
JD.com, Inc. is a leading Chinese e-commerce and retail infrastructure service providing a company with over 75 hedge fund holders. JD is currently trading at $78.29 with a 52 week low of $61.65 and a 52 week high of $108.29. The company has a Market Cap of $122.78 billion. Analysts regard Chinese internet stocks as crucial to the country’s economy in the coming years.
JD has a very strong presence in the supermarket category. In 2020, the company announced that they are planning to open 1,000 high-tech (online and offline) supermarkets within 5 years. Besides e-commerce, they are also involved in Cloud business and JD health business which allows you to see doctors online. JD’s revenue has been exceptionally growing over the years, especially during the pandemic period. Going forward, analysts expect the company to continue growing stronger. They have given it a rating of 1.8, meaning their stock is a buy. Furthermore, their average price target is $104.43 which is 33% higher than the current price.
Alibaba Group Holding Ltd (BABA)
Alibaba is often known as the “Amazon of China”. BABA is currently trading at $125.08, with a 52 week low of $108.70 and a 52 week high of $274.29. They hold a market cap of $339.08 billion and a PE of 17.58.
Alibaba’s revenue growth has been tremendous and is expected to continue growing by double digits well into the mid-2020s. Their revenue jumped from CNY 717 Billion in 2020 to CNY 814 Billion in the last twelve months, which consequently grew their gross profit by 15.8%. Similar to Amazon, Alibaba is much more than just an e-commerce company. They own Youku, the top streaming platform in China, South China Morning Post, a newspaper business, and Lazada, an e-commerce platform that’s popular in many Asian countries. They are also involved in many other businesses like Fintech, AI, tech companies, and internet services.
Alibaba’s chairman Daniel Zhang announced that the company aims to reach 1 billion consumers and achieve $1.4 trillion in China by the year 2024. If they continue doing well, they are likely to reach this goal soon.
NetEase, Inc. (NTES)
NetEase, Inc. is a Chinese company that provides online services focusing on gaming, communication, and commerce in China and internationally. NTES is currently trading at $105.77, with a 52 week low of $77.97 and a 52 week high of $134.33. They are standing at a Market Cap of $72.34 billion. The company’s recent Q3 results showcased a net revenue of $3.4 billion, an increase of 18.9% compared with last year’s 3rd quarter. Their gross profit also climbed to $1.8 billion, with year-over-year growth of 19.5%.
With the rising popularity of 5G around the globe, NetEase currently stands as one of the best China stocks to buy. The company has over 40 hedge fund holders as of right now. NetEase, Inc. pays an annual dividend of $0.82 per share. The stock’s current dividend yield stands at 0.77%. Analysts have given this company a rating of 1.5, implying it’s a buy, with a price target of $113.35 that is 7% higher than the current price.
NIO Inc. (NIO)
NIO Inc. designs, develops, manufactures, and sells smart electric vehicles in China. The company offers five, six, and seven-seater electric SUVs, as well as smart electric sedans. Right now, NIO is trading at $38.31, with a 52 week low of $30.71 and a 52 week high of $66.99. The company has a Market Cap of 60.93 Billion. In the last 12 months, they have incurred a total revenue of $32.8 million, which analysts expect to rise to $1.54 billion in the next quarter. They have given it a rating of 1.8, which is a buy. Their average price target per share is $58.45, which is over 50% greater than the current price.
NIO is a fantastic vehicle opportunity that has the opportunity to grow massively. However, because of its volatility, it is on the riskier side. That being said, despite the short-term pullbacks, the company has a lot more growth ahead of it in the long term. Some investors could be hesitant to invest in Chinese companies, but looking at the company’s huge improvement and estimate it’s hard to ignore a big tech corporate-like NIO. There is a lot is going on for this company and if you are big on the shift from internal combustion engine cars to electric vehicles, then NIO is definitely a stock to watch.
Tencent Holdings Limited (TCEHY)
Tencent is an investment holding company in China that is involved in many different industries globally. Right now, 1 share of TCEHY is trading at $59.51, with a 52 week low of $53.47 and a 52 week high of $99.40. They hold a Market Cap of $582 billion and even pays a mild dividend of 0.35% to its shareholders.
Tencent owns WeChat, a messaging social media and mobile payment app. It is also involved in Cloud computing, AI, online music and film production companies, which has been engaged in many Hollywood films. They even have a 5% stake in Tesla. However, Tencent is best known as the world’s largest game publisher in terms of revenue. We may not realize but many of the games we play (like PUBG and Fortnite) are actually owned by Tencent. The company has also been expanding their business overseas. Tencent further plans to continue to acquire more game companies in the future. TCEHY’s revenue has been astronomically growing over the years. They gathered a revenue of CNY 549 billion in the last 12 months compared to CNY 482 in 2020. Analysts are expecting this growth to continue on. They have given it a rating of 2, meaning it’s a buy. The average analysts’ price target for this company is $78.77. All in all, Tencent is a growth stock that’s worth considering.