5 Chinese Stocks to Avoid Amid Economic Slowdown

4. KE Holdings Inc. (NYSE:BEKE)

Number of Hedge Fund Holders: 37  

KE Holdings Inc. (NYSE:BEKE) engages in operating an integrated online and offline platform for housing transactions and services in China. On August 23, the company posted earnings for the second quarter of 2022, reporting losses per share of $0.08, beating market estimates by $0.13. The revenue over the period was $2.1 billion, down over 43% compared to the revenue over the same period last year and missing analyst estimates by $510 million. The firm also said that it expected total net revenues to be around $2.5 billion, representing a decrease of approximately 6.1% to 8.8% from 2021. The company is on the list of Chinese stocks to avoid amid economic slowdown. 

On August 25, Barclays analyst Jiong Shao maintained an Overweight rating on KE Holdings Inc. (NYSE:BEKE) stock and raised the price target to $26 from $24, appreciating the earnings report of the firm for the second quarter of 2022. 

At the end of the second quarter of 2022, 37 hedge funds in the database of Insider Monkey held stakes worth $1.6 billion in KE Holdings Inc. (NYSE:BEKE), compared to 34 in the preceding quarter worth $882.8 million. 

In its Q3 2021 investor letter, Tao Value, an asset management firm, highlighted a few stocks and KE Holdings Inc. (NYSE:BEKE) was one of them. Here is what the fund said:

“As witnessed in the past quarter, the government intervention in Chinese private sector is elevated to an unprecedented level. Given this background, I thoroughly reviewed all our Chinese holdings and made a few changes. We exited KE Holdings Inc. (NYSE:BEKE), for high potential regulatory risk and the passing of the visionary founder & CEO Zuo Hui (who was a core tenet of our original thesis).”