It is customary for many to go on holidays as the end of the year is approaching. At EastMoneyStocks, we believe that your money can still work for you, even while you are away from work. To do that, we consider 5 stocks with strong fundamentals that hold their value across time. After all, you don’t want to be constantly checking on the stock market while you are skiing in the Alps.
#1 Hengan International Group Company Limited (1044.HK)
Hengan is a leading manufacturer of daily care products in China. The company produces and sells paper products, such as paper towels, and women’s care products, such as sanitary napkins. Within the sanitary napkins space, there is a move towards higher quality products. Hengan has introduced more premium products which aim to improve users’ comfort. The stock is currently trading at a P/E ratio of around 15 times, below its historical levels which were usually above 20 times. Its dividend yield is also close to 5%, a respectable achievement for a company still in a growing phase.
#2 VICOM Limited
VICOM Limited (SGX: V01) is a leading testing and inspection company. The group has over 75% market share of the vehicular testing market in Singapore. In addition, VICOM also conducts testing and inspection services for mechanical and biochemical applications. VICOM has consistently generated about SGD 30m of FCF per year apart from 2018, when it acquired a new property for its headquarters. For the first half of this year, its FCF is close to SGD 14m.
#3 Alibaba Health Information Technology (241.HK)
Alibaba Health Information Technology is partly owned by Alibaba Group. The company is one of China’s largest online pharmaceutical platforms with more than 130 million annual active consumers.
For the year ended March 2019, the platform had gross merchandise volume of RMB 59.5 billion. Besides, sales from the company’s pharmaceutical e-commerce platform business almost quadrupled to RMB 690 million. The company has recently invested more in AI and hopes to launch more AI powered medical services in the future.
#4 Ping An Healthcare and Technology (1833.HK)
Ping An Healthcare and Technology had 265 million registered users and 54.7 monthly active users at the end of 2018. Through its online services, the company provides users with access to thousands of doctors and medical personnel for online consultation services supplemented with AI technology. The company’s platform also connects users with thousands of hospitals for arranging appointments.
The company’s daily average consultations rose 58% year-on-year in the first half of 2018. Sales more than doubled from RMB 448.6 million in the first half of 2017 to RMB 1.12 billion in the first half of 2018. As the stock trades at a price-to-sales ratio of 10, it may look expensive to some. Nevertheless, there is a huge potential in the market which should not be ignored.
#5 China Southern Airlines (1055.HK)
One may recall that China Southern Airlines (600029.SH, 1055.HK) announced earlier this year that it aims to become the world’s largest carrier within the next three years. It is already the largest carrier in Asia. The airline carried more than 140 million passengers last year and flew more than 840 passenger and cargo planes.
Just in August this year, one of China Southern Airlines’ hub airports which is Guangzhou Baiyun International Airport surpassed Hong Kong International Airport in terms of the number of monthly passengers. This appears to be a trend that can contribute positively to China Southern Airlines.