Zai Lab (HKSE:09688) GF Value Rank : 4 (As of Apr. 30, 2024)

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What is Zai Lab GF Value Rank?

Zai Lab has the GF Value Rank of 4.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

Competitive Comparison of Zai Lab's GF Value Rank

For the Biotechnology subindustry, Zai Lab's GF Value Rank, along with its competitors' market caps and GF Value Rank data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Zai Lab's GF Value Rank Distribution in the Biotechnology Industry

For the Biotechnology industry and Healthcare sector, Zai Lab's GF Value Rank distribution charts can be found below:

* The bar in red indicates where Zai Lab's GF Value Rank falls into.

Zai Lab GF Value Rank Related Terms

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Zai Lab (HKSE:09688) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Biotechnology » Zai Lab Ltd (HKSE:09688) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

ZLAB:USA ZLAB:Mexico 1ZLB:Germany

Address

4560 Jinke Road, Jinchuang Plaza, Building 1, 4th Floor, Pudong, Shanghai, CHN, 201210

Website

https://www.zailaboratory.com

Zai Lab Ltd is a biopharmaceutical company focusing on discovering or licensing, developing, and commercializing proprietary therapeutics that address areas of unmet medical need including in the fields of oncology, autoimmune and infectious diseases. The pipeline of proprietary drug candidates of the company includes ZL-2306 for treatment across multiple solid tumor types including ovarian and certain types of breast and lung cancers; ZL-2401 which is an antibiotic in a new class of tetracycline derivatives; and ZL-2301 is an oral, small molecule which targets HCC.

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