Zacks Value Investor Highlights: Alibaba, JD.com, Tencent, Baidu and Tal Education Group
For Immediate Release
Chicago, IL – May 28, 2021 – Zacks Value Investor is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:
Big-Cap Chinese Stocks: Values or Traps?
Welcome to Episode #237 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
With the weakness in growth names, it's time to take a look at some big caps to see if there are any true deals.
The Chinese stocks have been popular with investors the last few years as one of the few ways to play the great Chinese growth story.
Who doesn't want to tap the billions of consumers in their market?
But many of the big cap Chinese stocks have been weak in 2021 due to the crackdown by the Chinese government on big cap technology companies and the pandemic, among other things.
Is this a buying opportunity?
Or is it a trap?
Definition of a Value Stock Versus a Value Trap
Remember, classic value stocks have low classic fundamentals like P/Es, P/B, P/S and PEG ratios.
Value traps can have those too.
But true value stocks will have one differentiating thing: earnings growth.
Earnings will be expected to grow year-over-year.
Are Chinese stocks a value on this weakness?
5 Big Cap Chinese Stocks: Value or Trap?
1. Alibaba BABA shares are down 8.7% year-to-date compared with the S&P 500 which is up nearly 11%. It's P/E is just 18, which makes it the "cheapest" on a P/E basis of China's big cap tech companies. But are earnings expected to grow in 2021 and 2022?
2. JD.com JD shares are down 16.5% year-to-date. That's really underperforming the S&P 500 during that time. It has a sky-high forward P/E of 45 but it's PEG ratio is just 1.00. Is it a value?
3. Tencent TCEHY is China's largest social networks company and is sometimes called the "Facebook of China" because it operates WeChat. Shares are actually up nearly 10% year-to-date. It trades with a forward P/E of 32. Are earnings expected to grow this year?
4. Baidu BIDU is a cloud and AI-focused Chinese tech company which saw first quarter revenue jump 34%. But shares are down nearly 10% year-to-date. It trades with a "cheap" forward P/E of just 19.6. Is it a deal or a trap?
5. Tal Education Group TAL offers K-12 after-school tutoring services and has learning centers in 90 Chinese cities. Shares are down a whopping 44% year-to-date and it still has a forward P/E of 69. But is there value after the sell-off?
Should value investors be putting Chinese stocks on their watch list?
Find out on this week's podcast.
Legal Marijuana: An Investor's Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they've been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks' Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
Download Marijuana Moneymakers FREE >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com/performance
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Baidu, Inc. (BIDU) : Free Stock Analysis Report
TAL Education Group (TAL) : Free Stock Analysis Report
Tencent Holding Ltd. (TCEHY) : Free Stock Analysis Report
JD.com, Inc. (JD) : Free Stock Analysis Report
Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
