5 Most Promising Chinese Stocks According to Analysts

In this article, we discuss 5 most promising Chinese stocks according to analysts. If you want to read our discussion on the Chinese stock market, head over to 11 Most Promising Chinese Stocks According to Analysts. 

5. NIO Inc. (NYSE:NIO)

Number of Hedge Fund Holders: 18

Average Analyst Price Target: $10.55

Average Upside Potential: 90.43%

NIO Inc. (NYSE:NIO) specializes in designing, developing, manufacturing, and selling smart electric vehicles. The company offers electric SUVs and sedans, along with power solutions such as home charging, battery swapping, and mobile charging services. NIO Inc. (NYSE:NIO) is one of the most promising Chinese stocks. 

In January 2024, NIO Inc. (NYSE:NIO) achieved a year-over-year growth of 18.2%, delivering 10,055 vehicles. However, there was a significant month-over-month decrease of 44%. As part of its strategic initiatives, NIO expanded its power swap network to the broader industry and formed battery swapping partnerships with JAC Group and Chery Automobile. Moreover, in collaboration with key investors, the company established Zhongan Energy with the goal of constructing 1,000 battery swap stations across China.

According to Insider Monkey’s third quarter database, 18 hedge funds were bullish on NIO Inc. (NYSE:NIO), compared to 19 funds in the last quarter. Jos Shaver’s Electron Capital Partners is a prominent stakeholder of the company, with 4.2 million shares valued at $38 million. 

4. Li Auto Inc. (NASDAQ:LI)

Number of Hedge Fund Holders: 28

Average Analyst Price Target: $55.58

Average Upside Potential: 96.12%

Li Auto Inc. (NASDAQ:LI) creates, develops, manufactures, and markets new energy vehicles in China. Their lineup includes the Li ONE and Li L series, smart electric vehicles. Additionally, the company provides services encompassing sales, after-sales management, technology development, corporate management, and the acquisition of manufacturing equipment.

According to Insider Monkey’s third quarter database, 28 hedge funds were bullish on Li Auto Inc. (NASDAQ:LI), up from 25 funds in the last quarter. John Overdeck And David Siegel’s Two Sigma Advisors held the top position in the company, with 6.74 million shares worth $240.26 million.

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3. XPeng Inc. (NYSE:XPEV)

Number of Hedge Fund Holders: 13

Average Analyst Price Target: $16.73

Average Upside Potential: 104.27%

XPeng Inc. (NYSE:XPEV) is a Chinese company specializing in the design, development, manufacturing, and marketing of smart electric vehicles. The company’s product lineup includes SUVs, four-door sports sedans, and family sedans. Additionally, XPeng Inc. (NYSE:XPEV) provides advanced driver-assistance system technology and in-car intelligent operating systems. The stock ranks 10th on our list of the most promising Chinese stocks according to analysts. 

In January 2024, XPeng Inc. (NYSE:XPEV) achieved a significant year-over-year growth of 58%, delivering 8,250 smart EVs. The company provides advanced driver-assistance systems (ADAS) through XNGP, which is available in 243 cities across China. XNGP ADAS boasts an industry-leading monthly active user penetration rate of over 85%. XPeng Inc. (NYSE:XPEV) aims to extend its coverage to key urban road networks, parking areas, and private roads by 2024, and also plans to conduct research and development for expansion in international markets in 2024 and 2025.

According to Insider Monkey’s third quarter database, 13 hedge funds were bullish on XPeng Inc. (NYSE:XPEV), compared to 17 funds in the last quarter. D E Shaw is the largest stakeholder of the company, with 4.5 million shares worth $83.7 million. 

2. ZTO Express (Cayman) Inc. (NYSE:ZTO)

Number of Hedge Fund Holders: 21

Average Analyst Price Target: $33.83

Average Upside Potential: 110.39%

Next on the list of the most promising Chinese stocks is ZTO Express (Cayman) Inc. (NYSE:ZTO), which provides express delivery and additional logistics services. They offer freight forwarding and delivery services for both e-commerce and traditional businesses, as well as other users requiring express services. Established in 2002, the company is based in Shanghai, China. On November 16, ZTO Express (Cayman) Inc. (NYSE:ZTO) announced a Q3 Non-GAAP EPS of $0.39, exceeding estimates by $0.01. Its revenue came in at $1.24 billion, missing market consensus by $120 million. As per Wall Street analysts, ZTO is one of the most promising Chinese stocks. 

According to Insider Monkey’s third quarter database, 21 hedge funds were bullish on ZTO Express (Cayman) Inc. (NYSE:ZTO), down from 25 funds in the preceding quarter. Kerr Neilson’s Platinum Asset Management held the largest position in the company, with over 14.3 million shares valued at $345.99 million.

1. Zai Lab Limited (NASDAQ:ZLAB)

Number of Hedge Fund Holders: 18

Average Analyst Price Target: ​​$62.70

Average Upside Potential: 178.67%

Zai Lab Limited (NASDAQ:ZLAB), one of the most promising Chinese stocks, is involved in creating and bringing to market treatments for cancer, autoimmune conditions, infectious diseases, and neuroscience-related ailments, mainly in Mainland China and Hong Kong. Their product lineup includes Zejula, a once-a-day small-molecule inhibitor targeting poly polymerase 1/2; Optune, a device designed for delivering tumor treating fields; NUZYRA, used for treating acute bacterial skin and skin structure infections, as well as community-acquired bacterial pneumonia; and Qinlock, used specifically for gastrointestinal stromal tumors.

On November 7, Zai Lab Limited (NASDAQ:ZLAB) reported a Q3 GAAP EPS of -$0.71 and a revenue of $69.23 million, outperforming Wall Street estimates by $0.27 and $2.87 million, respectively. 

According to Insider Monkey’s third quarter database, 18 hedge funds were bullish on Zai Lab Limited (NASDAQ:ZLAB), compared to the last quarter when 23 funds had invested in the stock. Andreas Halvorsen’s Viking Global is the top shareholder of the company, with 2.5 million shares valued at $60.56 million.

Here is what ClearBridge Investments International Growth ACWI ex-U.S. Strategy has to say about Zai Lab Limited (NASDAQ:ZLAB) in its Q4 2021 investor letter:

“Economies in Asia, meanwhile, are taking the opposite approach on stimulus, with China lowering its reserve requirement ratio for banks to support flagging growth in the world’s second-largest economy. Japan’s new government passed a large stimulus bill after its economy contracted in the third quarter. Despite these actions, sentiment remains decidedly negative in these regions. Our underweight to Japan proved beneficial during the quarter while our single holding in China – biotechnology company Zai Lab – sold off sharply mostly due to generally weak sentiment around Chinese health care stocks.”

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