From Nasdaq: 2024-04-09 08:00:50

China internet stocks, including those in the KraneShares CSI China Internet ETF (KWEB), are trading at lower valuations due to Beijing’s strict regulatory measures. The $5.55 billion KWEB ETF has seen a 6.60% increase over the past month, hinting at growing investor interest in the sector’s potential.

Jeffrey Kleintop from Charles Schwab highlighted that Chinese companies face limitations on shareholder rewards, impacting firms like Alibaba (BABA), JD.com (JD), and Baidu (BIDU). Despite regulatory challenges, some companies are repurchasing shares, with Alibaba buying back $4.8 billion worth of stock in Q1.

Baidu and JD.com hold significant cash reserves, but their market values don’t fully reflect these assets. Kleintop suggests that easing capital controls could boost investor confidence and lead to better appreciation of Chinese companies’ financial strength and potential for shareholder rewards.



Read more at Nasdaq: Some China Internet Stocks Are Really Inexpensive