It's safe to say that China's image on the world stage has declined considerably over the past year. Geopolitical tensions, human rights issues, and questions about the origins of the coronavirus have left many deeply skeptical about the direction in which the world's most populous country is heading.

The negative perception has affected shares of China-based American depositary receipts (ADRs), causing many stocks to trade at ridiculously low discounts that would be otherwise hard to imagine in today's overvalued market. For value investors who are hungry for bargains, these are my top picks:

Portrait of a couple shopping by the Oriental Pearl Tower in Shanghai.

Image source: Getty Images.

1. 111, Inc.

It's a pretty hard sell on its name alone, but 111 (YI 1.50%) gets more exciting when you realize it's China's leading telepharmacy network. The company has partnerships with over 340,000 retail pharmacies in the country. It sells all kinds of health products, including generics, branded drugs, dietary supplements, medical devices, contact lenses, maternity care products, beauty products, and reproductive health items.

In the first quarter, 111's revenue increased by 65% year over year to RMB 2.6 billion Chinese Yuan ($396 million). The company is very close to breaking even, with net margins increasing to negative 4.2%, compared with negative 6.9% in the prior-year quarter. Until it can turn a profit, 111 is sitting comfortably on close to RMB 1.5 billion in cash and investments ($177.5 million), compared with just RMB 229 million in borrowings ($6.845 million).

Right now, its stock has a valuation of just 0.6 times revenue. That is very cheap for such a high-flying growth stock. Keep an eye out for continued momentum for new segments -- such as chronic disease care and primary care partnerships with local doctors -- on its next earnings report.

2. (JD 0.71%) is China's biggest (and coolest) e-commerce retailer. The company generates about RMB 600 billion ($114 billion) per year in revenue -- about the same as the other top nine Chinese e-commerce entities combined. Moreover, its profitability has been steadily improving over the years, with its net margin expanding from 0.2% in 2015 to its current 2%.

Unlike its competitors, the company owns the entire supply chain from item storage to fulfillment to delivery. is known for using its fleet of autonomous delivery vans, delivery drones, and warehouse robots to cut costs. In addition, it has over 1,000 warehouses and 200,000 delivery personnel covering almost every corner of China. stock currently trades at just 1 times revenue and 15 times earnings. That's pretty cheap for a company growing its sales by nearly 40% year over year. As a result, it is a fantastic e-commerce stock to add to one's watchlist. 

3. Yiren Digital

Yiren Digital (YRD 1.84%) is a Chinese peer-to-peer (P2P) loan-facilitation platform. Starting in 2018, the company became embroiled in a broad scandal involving nearly all service providers in China's P2P ecosystem. Borrowers alleged that Yiren Digital profited from hefty commissions when its lenders issued the loans, as well as charging high interest rates and resorting to abusive collection practices when the borrowers defaulted. As a result, shares have declined by nearly 80% over the past two years.

However, it appears Yiren Digital has finally cleaned up its act and returned to growth. Compared with Q1 2020, the company's revenue and earnings in Q1 2021 increased by 7% to RMB 1.1 billion ($170 million) and by 843% to RMB 181.2 million ($28.32 million), respectively.

The growth was largely driven by a 270% increase in its new life and property insurance business. Its core lending business has also been resilient, accumulating 5.3 million borrowers and 2.4 million lenders. In addition, loan-default rates have once again fallen below 1%. That is pretty good for a P2P lending business.

It may be time for investors to begin trusting Yiren Digital, especially since the company's financials suggest the worst is over. The stock trades at a meager 0.76 times sales and 8.2 times earnings. Up nearly 36% in the past five days on the announcement of solid earnings, this is definitely a financial stock worth a look.