Hong Kong technology stocks have performed weakly this week. As of press time, the hang Seng technology index has fallen about 5% this week, giving up last week's gains. Although most constituent stocks still recorded declines this year, most of them have come out of the lowest point of the year, rebounding by more than 20%.
According to statistics, as of October 28, Tencent, BABA and Meituan were up more than 18%, 25% and 48% respectively from the lowest prices for the year.
Among the stocks in the Hang Seng Technology Index, Kuaishou Technology rebounded the most, reaching 61%, up more than 23% in the past two weeks.
Credit Suisse said that Kuaishou Technology's user size is on a growth track, and taking into account the summer vacation and the Olympic Games and other contents, the company is expected to increase the number of monthly active users (MAU) and average daily active users (DAU) by 7% on a quarterly basis, and the average number of daily active users for the whole year will grow by 16% year-on-year to 320 million in the fourth quarter.
Nomura expects Kuaishou Technology's revenue in the third quarter of this year to rise 31 per cent year-on-year to 20.1 billion yuan, in line with market expectations.
In addition, JD.com, NetEase, Inc and Sunny Optical Technology rebounded by more than 30%, while Weimeng Group rebounded by 50%.
CITIC research newspaper pointed out that since the beginning of the year, China Internet companies have substantially retreated nearly 50%, mainly reflecting expected fluctuations brought about by policy regulation, short-term fundamentals relatively weak compared to comparable companies in US stocks, and so on. Due to the continuous clarity of the policy regulatory framework and the high probability of improvement in the fundamentals of 2022, we are optimistic about the investment opportunities of the Internet sector in 2022.
After a substantial adjustment in the previous period, the valuation of the head Internet company has fallen back to an all-time low, and the risk has been greatly released. drawing lessons from the experience of the US stock market, the combination of the downward shift of the performance growth center and the improvement of high certainty of performance, it is expected that the gap between the valuation level of China Internet leader and overseas companies will continue to narrow.
In addition, domestic cloud computing and overseas online games will also be an important support for domestic Internet leaders to achieve medium-and long-term growth and higher valuation. In the long-term dimension, CITIC said that it continues to recommend the leading manufacturers with strong competitive position and new business & the new market has room for expansion.
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