- JD's stock price is down over 25% from its all-time highs, and Tencent's stock price is down over 35% from its all-time highs. There are numerous reasons for the depreciation in stock price, including tensions between the USA and China, Chinese cybersecurity regulators, and Chinese government interference in Chinese companies. Regardless, there might be some hidden valuation gems inside Chinese equities.
- JD.com continues to expand into new markets and products. In September, JD opened its first online store in Indonesia and launched physical stores and additional distribution centers in China to help improve its omnichannel retail experience. For the past year, JD has also focused on enhancing its telemedicine services, and on Oct. 8, it launched a telehealth service for pets.
- Tencent's stock price has taken a hit due to stricter restrictions on minors in China, specifically on how much they can play video games during the week. Tencent also owns numerous social platforms that could be potential targets for Chinese cybersecurity regulators. At the same time, investors should be aware the gaming regulations are not new in China, and minors in China were already under strict gaming limitations.
Click the video below for my full thoughts and analysis.
*Stock prices used were the midday prices of Oct. 8, 2021. The video was published on Oct. 8, 2021.