Is Autohome (ATHM) a Smart Investment?

Polen Capital, an investment management company, released its “Polen Global Emerging Markets Growth Fund” second quarter 2022 investor letter. A copy of the same can be downloaded here. In the second quarter, the fund returned -9.27% net of fees compared to a -11.44% return for the MSCI Emerging Markets Index. Global economic concerns impacted the fund’s performance in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2022.

In the second quarter 2022 investor letter, Polen Capital discussed stocks like Autohome Inc. (NYSE:ATHM). Headquartered in Beijing, the People’s Republic of China, Autohome Inc. (NYSE:ATHM) is an online automotive platform. On September 29, 2022, Autohome Inc. (NYSE:ATHM) stock closed at $29.21 per share. One-month return of Autohome Inc. (NYSE:ATHM) was -13.94% and its shares lost 37.76% of their value over the last 52 weeks. Autohome Inc. (NYSE:ATHM) has a market capitalization of $3.745 billion.

Here is what Polen Capital specifically said about Autohome Inc. (NYSE:ATHM) in its Q2 2022 investor letter:

“Autohome Inc. (NYSE:ATHM) is China’s leading online car classified company and one company that, in our view, was unfairly punished in reaction to China’s regulatory crackdown last year. Autohome saw a steep decline in its share price in 2021 as most tech-related companies sold off, irrespective of the actual direct impact of regulatory changes or how cash-generative their businesses were.

While earnings of Autohome did soften during the year as the global chip shortage weighed on new car sales, we expect the company to return to the earnings growth levels it has historically delivered. The company’s 70% share price decline in 2021 left it trading on levels we considered very attractive, and we took the opportunity to increase our position earlier in the year. Despite the bounce during the quarter, we still view the company as materially undervalued.”

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Autohome Inc. (NYSE:ATHM) is not on the list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held Autohome Inc. (NYSE:ATHM) at the end of the second quarter which was 14 in the previous quarter.

We discussed Autohome Inc. (NYSE:ATHM) in another article and shared Giverny Capital’s views on the company. In addition, please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.

Disclosure: None. This article is originally published at Insider Monkey.