“Valuation repair” is still the main line of the current market, and value stocks are expected to continue to outperform overvalued growth stocks. Recently, under the background of “high-low switching” of market style, more subject matter with low valuation and stock price has been favored by institutions.
Yesterday, China Mobile hit the daily limit for the first time after its A-share listing, and its share price also hit a new high since its listing. The stock has risen sharply for two consecutive days, with an intraday rise of more than 7% on February 8. Large scale research of institutions and intensive bullish of securities companies are important catalysts for its rise. Recently, in the context of “high-low switching” of market style, more subject matter with low valuation and stock price has been favored by institutions, and the institutions that went to the research rank high.
The rise of China Mobile’s share price occurred after the implementation of the “green shoe mechanism”, which is related to many factors, such as the increase of its controllers’ holdings, the pre increase of annual report performance and so on. On the eve of the company’s share price surge, China Mobile not only received a pile of research from institutions, but also issued in-depth research reports from a number of head securities companies, which played a catalytic role in the upward trend of share price.
Some market participants said that under the background of A-share market differentiation and style “high-low switching”, the perspective of institutional research is also “lowering”: some varieties with low valuation, low share price position and relatively stable performance have received more attention, which has a certain “wind vane” significance.
On February 7, China Mobile announced that on January 21, the company received 23 research institutions such as China International Capital Corporation Limited(601995) , China Securities Co.Ltd(601066) , Boc International (China) Co.Ltd(601696) , Huatai Securities Co.Ltd(601688) . According to the survey summary, investors asked about the progress of the company’s Hong Kong stock repurchase, the capital expenditure arrangement and planning in 2022, the business deployment of yuancosmos, and whether it has begun to use self-developed chips.
Since February 8, Citic Securities Company Limited(600030) , China International Capital Corporation Limited(601995) , Zheshang Securities Co.Ltd(601878) and other securities companies have intensively released research reports. Among them, Citic Securities Company Limited(600030) gives the company a share target price of 75 yuan / share.
Citic Securities Company Limited(600030) said that China Mobile is a leading global operator. The company has leading profitability, high-quality assets, good cash flow performance and significant advantages in network resources and user scale. China Mobile’s competitive advantage in the 5g era is expected to be further consolidated and is optimistic about the good development of China Mobile’s business and the continuous growth of its performance. Zheshang Securities Co.Ltd(601878) believes that the inflection point of the industry has been established. Driven by the improvement of 5g penetration and the strong growth of innovative business, it continues to be optimistic about the development expectation of telecom operators.
From the recent institutional research trends, institutional funds may be carrying out a new round of position adjustment and share exchange, in which public funds may be the “main force” of position adjustment. Data show that since February 1 this year, nearly 1000 sub institutions have participated in the research of 19 companies. From the type of research institutions, fund companies account for the highest proportion, with more than 300 times of participation.
Statistics show that the subject matter with low valuation level is one of the key points of recent institutional research. Since February 1, among the seven A-share companies surveyed by more than 50 institutions, except one with a loss and one with a rolling P / E ratio of more than 100 times, the P / E ratio of other companies is mostly in the range of more than 20 times to more than 30 times, and one company is less than 20 times.
From the perspective of industry distribution, recently, enterprises in construction decoration, agriculture, forestry, animal husbandry and fishery, light industry manufacturing and other industries have frequently appeared on the research list. For example, Joyvio Food Co.Ltd(300268) was investigated by 8 institutions and Hongrun Construction Group Co.Ltd(002062) was investigated by 2 institutions.
Echoing the agency’s excavation of undervalued stocks with high “safety margin” in the research, since this year, the performance of undervalued blue chips has been significantly stronger than that of track stocks with large cumulative increase and high valuation. Since February 1, after falling by 12.45% in January, the gem index has further fallen by 0.87%, while the Shanghai and Shenzhen 300 index has increased by 1.93% in the same period.
The mainstream view of institutions is that “valuation repair” is still the main line of the current market, and value stocks are expected to continue to outperform high valuation growth stocks. Tianfeng Securities Co.Ltd(601162) it is expected that the short-term style of the market is expected to continue to switch to undervalued varieties, and the prosperity of the infrastructure sector is expected to rise in the first quarter of this year. It is suggested to continue to explore investment opportunities in the construction industry along the two main lines of prefabricated construction and undervalued blue chip.
Haitong Securities Company Limited(600837) said that historically, in the “steady growth” spring market, A-Shares tend to value first and then grow. For example, undervalued financial, real estate, new infrastructure and other sectors will rise first. Tan Li, the value style investment director of Harvest Fund, said she was optimistic about the large cap value stocks represented by banks and real estate. In addition, small cap growth stocks will still have more opportunities for individual stocks. In some subdivided manufacturing industries, excellent companies will stand out and need to be selected from bottom to top. Most of them have the logic of industrial upgrading, which is the strongest investment logic in the medium and long term. However, some stocks have increased significantly in the short term, which needs to be rebalanced.
