10Mon·

Hello, what do you think of $1211 (-1.33%) ? Despite the restrictions imposed by the EU and the tariffs imposed on the company by the USA and Canada, I am convinced of BYD in the long term. What do you think of the company?

2 Comments

Charmin@Charmin

10Mon

If you look at the figures, this is a clear buy. P/E ratio at 23. Compare that with $TSLA...

However, I simply don't know enough about the automotive sector to get involved. Factors such as politics and infrastructure are also too uncertain for me.

•

Imperial_Trading_Company@Imperial_Trading_Company

10Mon

The main problem with Chinese car stocks is the political risk and the punitive tariffs.
That's really hard to assess.
Otherwise, BYD is the number 1 in the Asian e-mobility sector and is definitely worth buying.

I opted for the number 2 in this sector - Geely $175.
Why?
On the negative side, Geely is facing the same problems as BYD.
On the positive side, Geely has been in the top 10 largest automotive companies in the world since this year with a market cap of 10 billion.
Measured against this, the share is, like BYD, unrestrainedly undervalued with a P/E ratio of 5, price to sales of 0.2 and forward P/E of 9.

The Geely Group owns Volvo, which means that existing infrastructure in Europe can be used.

There is also the joint Geely/Volvo subsidiary Lynk & Co, which already sells the Polestar in Europe, and of course the Geely flagship Zeekr.
Both Polestar and Zeekr have now had their own IPO, but Geely still holds 51% of both (although I am no longer sure about Zeekr, because Trade Republic paid me off in a vague way for the spin-off...).

All in all, BYD and Geely are a buy for me, provided you keep the political risk in mind.
But I think you will need a lot of patience before it pays off.
If you want to hold for the long term, I could imagine that BYD's current share price will be seen as ridiculously low in retrospect.

•