8 Most Promising Chinese Stocks According to Hedge Funds

5. KE Holdings Inc. (NYSE:BEKE)

Number of Hedge Fund Holders: 43

KE Holdings Inc. (NYSE:BEKE) is a leading Chinese firm that operates an integrated online and offline platform for housing transactions and services. The company operates through its platforms including, Beike and Lianjia. Beike is its integrated online and offline platform for housing transactions and services, while Lianjia is a real estate brokerage branded store. The company also owns the Deyou brand for connected brokerage stores and other brands. The company operates 8,000 offices in China and manages over 500,000 rental apartments.

Despite a record real estate crisis, KE Holdings Inc. (NYSE:BEKE) has enhanced its market share in both existing and new home markets. The company’s success is mainly driven by its Agent Cooperation Network (ACN), which standardized transactions and promoted agent cooperation. In addition, the company’s trusted brand, Lianjia is one of the most authentic platforms for property listings.

During the second quarter of 2024, KE Holdings Inc. (NYSE:BEKE) exceeded earnings and revenue estimates. The company posted earnings per share of $0.22, beating consensus estimates by $0.11 per share. The revenue was reported at $3.26 billion, surpassing estimates by $172.98 million and a year-over-year growth of 19.9%.

The impressive results were fueled by an increase in its current home transaction services and the growth of its home renovation and rental divisions. The income from current home transactions was around $1 billion, experiencing a 14.3% year-over-year increase, while the income from home renovation and furnishing services soared by more than 53% to $600 million.

KE Holdings Inc. (NYSE:BEKE) is one of the most promising Chinese stocks and had a forward P/E of 21.49, trading at a discount of 41.50% to its sector median. As of the end of the second quarter, 43 hedge funds tracked by Insider Monkey held stakes in the company.

Baird Chautauqua International and Global Growth Fund stated the following regarding KE Holdings Inc. (NYSE:BEKE) in its Q3 2024 investor letter:

“KE Holdings Inc. (NYSE:BEKE) reported better-than-expected results this year, but its valuation was depressed due to pessimism toward the property market in China. Recently announced stimulus measures in China and specific measures for its property market have somewhat reduced the extreme pessimism seen earlier in the year.”