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The Matthews China Fund's Top Five Fourth Quarter Holdings

Monica Wolfe

133 followers

The Matthews China Fund (Trades, Portfolio) recently reported its fourth quarter international holdings.  The fund’s portfolio consisted of stocks from the United States, China, Taiwan and Hong Kong.  Their most updated portfolio maintains 58 stocks valued at $1.4 billion.

The following five companies are the Matthews China Fund (Trades, Portfolio)’s largest holdings.

Tencent Holdings (HKSE:00700)

Over the past quarter Tencent Holdings was the Matthews China Fund (Trades, Portfolio)’s top holding.  The fund held on to 687,700 shares of the company’s stock making up for 3.1% of the fund’s total portfolio as well as 0.04% of the company’s shares outstanding.

Over the duration of the fourth quarter the fund cut their holdings -5.9% by selling a total of 43,100 shares of the stock.  They sold these shares near the estimated average quarterly price of ¥436.72 per share.  From this average price the price per share has jumped up an additional 24.5%.

Matthews China Fund (Trades, Portfolio)’s holding history:

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Tencent Holdings is engaged in providing Internet value-added services, mobile and telecommunications value-added services, online advertising services and e-commerce transactions to users in China.

Tencent Holdings’ historical revenue and net income:

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The analysis on Tencent reports that the company’s dividend yield is near a 3-year low, its price is near a 10-year high and its gross and operating margins have been in a long term decline.

Tencent Holdings has a market cap of ¥1007.29 billion.  Its shares are currently trading at around ¥543.50 with a P/E ratio of 53.20, a P/S ratio of 14.35 and a P/B ratio of 14.88.  The company had an annual average earnings growth of 56.20% over the past five years.

Kingdee International Software Group (HKSE:00268)

Matthews China Fund (Trades, Portfolio)’s second largest holding goes to Kingdee International Software where the company holds on to 123,524,800 shares of the company’s stock.  This position represents 2.7% of the fund’s total holdings as well as 4.90% of the company’s shares outstanding.

The fund has not altered their position in Kingdee since the first quarter of 2012, and since their last buy the fund has seen an average gain of 35.3%.

Matthews China Fund (Trades, Portfolio)’s holding history as of the fourth quarter:

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Kingdee International Software Group develops, manufactures and sells enterprise management software products and provides software-related technical services in China and Asia Pacific region. It also offers middleware, online management and life-cycle e-commerce services.

Kingdee International Software’s historical revenue and net income:

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The analysis on the company reports that the company’s revenue has been in decline over the past year, it has issued ¥1.9 billion of debt over the past year and its asset growth is currently notably greater than its revenue growth.

Kingdee International Software Group has a market cap of ¥7.39 billion.  Its shares are currently trading at around ¥2.80 with a P/S ratio of 3.57 and a P/B ratio of 3.71.

Sinopharm Group (HKSE:01099)

The fund’s third largest holding is in Sinopharm Group where they hold on to 12,602,000 shares of the company’s stock.  This position makes up for 2.6% of their total portfolio as well as 0.52% of the company’s shares outstanding.

During the fourth quarter the fund cut their position by a slight -3.97% by selling a total of 520,400 shares of Sinopharm.  They sold these shares near the average quarterly price of HK$21.99 per share, and since then the price per share has dripped a slight -2.7%. 

Matthews China Fund (Trades, Portfolio)’s historical holding history:

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Sinopharm Group Co is a pharmaceutical distributor. The company distributes pharmaceutical products to hospitals and clinics and operates pharmaceutical chain stores. Its segments include pharmaceutical distribution and retail pharmacy.

Sinopharm’s historical revenue and net income:

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The analysis on Sinopharm reports that the company has issued HK$5.6 billion of debt over the past year, the dividend yield is close to a 5-year high and its asset growth is notably faster than its revenue growth.

Sinopharm has a market cap of HK$56.25 billion.  Its shares are trading at around ¥21.40 with a P/E ratio of 21.40, a P/S ratio of 0.31 and a P/B ratio of 1.86.  The company had an annual average earnings growth of 30.30% over the past five years.

Mindray Medical International (MR)

The fund’s fourth largest holding goes to Mindray Medical which is actually not a China-based company. Matthews holds on to 998,168 shares of the company’s stock, representing 2.6% of their total portfolio and 0.58% of the company’s shares outstanding.

Over the past quarter they added 2.84% to their position by purchasing 27,600 shares of the company’s stock.  They bought these shares near the average quarterly price of $38.87 per share.  Since then the price per share has dropped -7.4%.

Matthews China Fund (Trades, Portfolio)’s historical holding history:

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Mindray Medical International Limited is a developer, manufacturer and marketer of medical devices. Its business is segmented into three - patient monitoring and life support products, in-vitro diagnostic products and medical imaging systems.

Mindray Medical International’s historical revenue and earnings growth:

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The analysis on Mindray Medical reports that the company has issued $315.07 million of debt over the past three years, its operating margin has been in a 5-year decline and its P/B and P/S ratios are trading near historic lows.

Mindray Medical International Limited has a market cap of $4.26 billion.  Its shares are currently trading at around $35.59 with a P/E ratio of 20.90, a P/S ratio of 3.80 and a P/B ratio of 3.00.  The company had an annual average earnings growth of 13.20% over the past five years.

China Lonyuan Power Group (HKSE:00916)

The guru’s fifth largest position is in China Lonyuan Power Group where the fund maintains 28,680,000 shares of the company’s stock.  These holdings make up for 2.6% of the fund’s total assets managed as well as 0.36% of the company’s shares outstanding.

The fund did not alter their position over the duration of the fourth quarter.  Since they began holding the company in the fourth quarter of 2009, the fund has seen average gains of 10% on shares bought.

The fund’s holding history as of the fourth quarter:

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China Longyuan Power Group Co is involved in wind and coal power generation and sale, coal trading and other related business in the People's Republic of China.

China Longyuan Power’s historical revenue and net income:

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The analysis on China Longyuan reports that over the past year the company has issued HK$28 billion of debt, its dividend yield is near a 3-year low and its price is near a 3-year high.

The Peter Lynch Chart suggests that the company is currently overvalued:

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China Longyuan Power Group has a market cap of HK$75.06 billion.  Its shares are currently trading at around HK$9.45 with a P/E ratio of 21.60, a P/S ratio of 3.24 and a P/B ratio of 1.65. 

You can check out Matthews China Fund’s entire fourth quarter portfolio listings here. If you cannot see the fund’s portfolio, you might not have the GuruFocus Global Membership.  Try a free 7-day trial here!


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