12 Cheap Chinese Stocks to Buy According to Hedge Funds

9. Qifu Technology, Inc. (NASDAQ:QFIN)

Number of Hedge Fund Holders: 27

Forward P/E Ratio: 6.07

Qifu Technology, Inc. (NASDAQ:QFIN), previously known as 360 DigiTech, is a China-based firm that operates a data-driven platform that allows financial institutions to provide better and targeted products and services to a broader consumer base. The company offers services in two ways including credit-driven services and platform services based on the nature of credit risk. The company also provides standardized risk management services such as software-as-a-service (SaaS) modules to institutional clients.

According to analysts, Chinese banks are likely to experience record-low profit margins following Beijing’s broader stimulus package. On the other hand, Qifu Technology, Inc. (NASDAQ:QFIN) might benefit from it as the demand for credit risk management might soar for financial institutions.

During Q2 2024, Qifu Technology’s (NASDAQ:QFIN) net income increased by 23% year-over-year, driven by a significant provision write-back and lower operating costs. In the third quarter, the company expects a normalized earnings growth of 36% year-over-year. Moreover, the company also anticipates additional provision write-backs in the coming quarters due to increased asset quality.

The company has a potential fiscal year 2024 buyback yield of 9.5%, mainly backed by its ongoing share repurchase program. Qifu Technology has engaged nearly 60% of its one-year $350 million buyback plan. The company has nearly 53.6 million cumulative users with approved credit lines, while it has 160 cumulative financial institution partners.