In light of an improving relationship between the U.S. and China, five Chinese stocks with high guru ownership as of the first-quarter 13F filing include JD.com Inc. (JD, Financial), Baidu Inc. (BIDU, Financial), H World Group Ltd. (HTHT, Financial), Trip.com Group Ltd. (TCOM, Financial) and Vipshop Holdings Ltd. (VIPS, Financial) according to the Aggregated Portfolio of Gurus, a Premium feature of GuruFocus that is based on an aggregation of 13F and mutual portfolio fund updates.
On Monday, Chinese President Xi Jingping told U.S. Secretary of State Anthony Blinken in a meeting that the world needs “generally stable” relationships between the U.S. and China, further opining that the U.S. should make “more positive contributions” to improve relationships between the two countries.
As such, investors may find opportunities in Chinese stocks that are most broadly held among gurus. As of Tuesday, the Most Broadly Held model portfolio returned a cumulative 447.36% since its inception in 2006. On an annualized basis, the portfolio gained approximately 12.25% per year over the past 15 years, compared to the Standard & Poor’s 500 Index benchmark return of an annualized 8.27% per year over the same period.
Investors should be aware 13F and NPORT-P filings do not give a complete picture of a firm’s holdings as the reports only include its positions in U.S. stocks and American depository receipts, but they can still provide valuable information. Further, the reports only reflect trades and holdings as of the most-recent portfolio filing date, which may or may not be held by the reporting firm today or even when this article was published.
JD.com
Seventeen gurus own shares of JD.com (JD, Financial) with a combined weight of 24.94%.
Shares of JD.com traded around $36.79 on Tuesday, showing the stock is significantly undervalued based on its price-to-GF Value ratio of 0.40.
The Beijing-based e-commerce company has a GF Score of 72 out of 100 based on a growth rank of 9 out of 10, a financial strength rank of 8 out of 10, a profitability rank of 5 out of 10, a GF Value rank of 4 out of 10 and a momentum rank of 1 out of 10.
JD.com’s high growth rank is driven by three-year revenue and book value growth rates outperforming more than 81% of global competitors.
Gurus with holdings in JD.com include Chase Coleman (Trades, Portfolio)’s Tiger Global Management and Dodge & Cox.
Baidu
Thirteen gurus own shares of Baidu (BIDU, Financial) with a combined weight of 7.50%.
Shares of Baidu traded around $143.09 on Tuesday, showing the stock is fairly valued based on its price-to-GF Value ratio of 0.96.
The Beijing-based online media giant has a GF Score of 84 out of 100 based on a momentum rank of 10 out of 10, a profitability rank of 8 out of 10, a GF Value rank of 5 out of 10 and a rank of 6 out of 10 for growth and financial strength.
Gurus with holdings in Baidu include PRIMECAP Management (Trades, Portfolio) and Dodge & Cox.
H World Group
Twelve gurus own shares of H World Group (HTHT, Financial) with a combined weight of 3.21%.
Shares of H World Group traded around $40.68 on Tuesday, showing the stock is modestly undervalued based on its price-to-GF Value ratio of 0.76.
The Shanghai-based hotel company has a GF Score of 77 out of 100 based on a rank of 7 out of 10 for GF Value and profitability, a momentum rank of 6 out of 10, a growth rank of 5 out of 10 and a financial strength rank of 4 out of 10.
Although the company’s Beneish M-score of -2.9 suggests minimal earnings manipulation, H World Group has a low Altman Z-score of 1.33 and a debt-to-equity ratio that is above 3 and underperforms approximately 90% of global competitors.
Gurus with holdings in H World Group include Steven Cohen (Trades, Portfolio)’s Point72 Asset Management, Al Gore (Trades, Portfolio)’s Generation Investment Management and Mason Hawkins (Trades, Portfolio)’ Southeastern Asset Management.
Trip.com
Eleven gurus own shares of Trip.com (TCOM, Financial) with a combined weight of 1.88%.
Shares of Trip.com traded around $34.79 on Tuesday; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.9.
The Shanghai-based travel agent company has a GF Score of 58 out of 100 based on a rank of 5 out of 10 for financial strength and profitability, a GF Value rank of 6 out of 10, a growth rank of 2 out of 10 and a momentum rank of 1 out of 10.
Trip.com’s low growth rank is driven by several warning signs, which include three-year revenue and earnings decline rates underperforming more than 75% of global competitors.
Gurus with holdings in Trip.com include Fisher Investments and Bridgewater Associates.
Vipshop Holdings
Nine gurus own shares of Vipshop Holdings (VIPS, Financial) with a combined weight of 2.09%.
Shares of Vipshop Holdings traded around $17.05 on Tuesday, showing the stock is fairly valued based on its price-to-GF Value ratio of 1.07.
The Guangzhou, Guangdong-based discount retail company has a GF Score of 79 out of 100 based on a financial strength rank of 9 out of 10, a profitability rank of 8 out of 10, a growth rank of 7 out of 10 and a rank of 3 out of 10 for GF Value and momentum.
Vipshop’s high financial strength is driven by several positive investing signs, which include a high Piotroski F-score of 7 out of 9, a strong Altman Z-score of 4.71 and an interest coverage ratio that outperforms more than 90% of global competitors.
Gurus with holdings in Vipshop include David Herro (Trades, Portfolio)’s Oakmark International Fund and Sarah Ketterer (Trades, Portfolio)’s Causeway Capital Management.
