NVIDIA’s financial results will be released on Wednesday, and this week is going to be crucial for the market. NVIDIA’s role in artificial intelligence is closely watched. The article below highlights the best Chinese stocks this week including PDD Holdings, Li Auto and Ehang.
EHang Holdings (EH)
EHang Holdings, which will publish its results this week, is one of China’s top stocks. The stock has dropped over 43% since its peak this year.
Analysts believe that EHang will be a top player in the electric vertical lift-off (eVTOL).
EHang, unlike its American competitors like Joby Aviation or Archer Aviation is already in the business of delivering products.
Recent financial reports showed that revenue increased by 288% for the entire year and 190% during the fourth quarter. The company delivered 216 vehicles last year, and it has achieved non-GAAP profit.
EHang’s revenue grew to $22.5m in the fourth-quarter. The company made a $6.4 million net loss and expects to be profitable this year.
The company has an advantage because it is the first to enter the Chinese market. It is also expanding into other countries such as Japan, Thailand and Mexico. The company has announced expansion plans in Yunfu as well as Hefei Weihai and Beijing. The company has also a backlog exceeding 1,200 planes.
PDD Holdings PDD
PDD Holdings, the parent company for Pinduoduo and Temu, will be releasing its results this week.
The company is going to discuss de minimis and the impact it has on Temu. De minimis is a policy of the US government that allows products under $800 to enter without being taxed.
The earnings of PDD will show if its business is growing. Recent earnings show that the company’s fourth-quarter revenues rose 24%, to $15.15 Billion. Its operating profits rose 14% to $3.55 billion.
Temu’s strong growth, which is well-known for its cheap products, has helped to boost the annual revenue by 59%, reaching $27 billion.
PDD’s balance sheet is one of the strongest in China. The company ended up with $56 billion of current assets. Of this, $7.9 billion was cash and cash-equivalents. And $37 billion were short-term investments. The company also holds $9.7 billion of restricted cash.
Analysts on Wall Street expect that the company’s revenue will increase by 18.7%, to CNY 103.1 billion and earnings per share CNY 18.96.
Li Auto (LI).
This week, as Li Auto releases its financials results, it is one of the top Chinese EV companies to keep an eye on. The stock is up over 50% since its lowest point in the year.
Analysts expect that Li Auto will report a slight drop in revenue to CNY25 billion for the first quarter. Analysts expect the earnings per share to drop from CNY 1,21 to CNY 0,64.
Analysts expect Li Auto to resume growth in the next year, and analysts predict its revenue will be CNY169 billion (up 17.2% over last year).
The latest results showed the company’s deliveries continue to grow. In April it delivered 33 939 vehicles, an increase of 31% compared to the same period in last year. Its March deliveries were 36,674.
Li Auto is a stock that analysts are bullish about, and their average price target for the Li Auto share price has risen to $33.77 from its current value of $28.9.
The ICD published the article Top Chinese stocks this week to watch: PDD Li Auto Ehang
