Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Bottom-Up

<ul>
<li>Screening US-listed China plays with negative EV and positive tailing EBITDA generates eight names. </li>
<li>Of these companies, only two are expected to be EBITDA positive in FY22. </li>
<li>They are <a href="https://www.smartkarma.com/entities/joyy-inc" target="_blank" data-smartkarma-citation="entities:285:1" rel="noopener">JOYY (YY US)</a> and <a href="https://www.smartkarma.com/entities/sohu-com-ltd" target="_blank" data-smartkarma-citation="entities:22853:1" rel="noopener">Sohu.com (SOHU US)</a>. This insight looks at both names. </li>
</ul>


Screening US-listed China plays with negative EV and positive tailing EBITDA generates eight names. 
Of these companies, only two are expected to be EBITDA positive in FY22. 
They are JOYY (YY US) and Sohu.com (SOHU US). This insight looks at both names. 


Negative EVs: JOYY & Sohu's Steep Discount To Net Cash

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

Thematic (Sector/Industry)

Since coronavirus fears gripped markets, the majority of Chinese tech stocks have experienced sharp selloffs with travel-related names being especially impacted. In the charts below, we highlight some of the biggest losers in China tech showing the % price drops from January 20 to today.As we highlighted in our previous note <a href="https://www.smartkarma.com/insights/tcel-china-s-new-virus-is-scary-but-one-chart-shows-how-you-can-profit" target="_blank" data-smartkarma-citation="insights:36013" rel="noopener">TCEL: China’s New Virus Is Scary, But One Chart Shows How You Can Profit</a>, market downturns from virus outbreaks tend to be short-lived and have always rebounded strongly after.

Since coronavirus fears gripped markets, the majority of Chinese tech stocks have experienced sharp selloffs with travel-related names being especially impacted. In the charts below, we highlight some of the biggest losers in China tech showing the % price drops from January 20 to today.As we highlighted in our previous note TCEL: China’s New Virus Is Scary, But One Chart Shows How You Can Profit, market downturns from virus outbreaks tend to be short-lived and have always rebounded strongly after.

Coronavirus Casualties: China Tech's Ten Biggest Losers

China

Xunlei Ltd. offers Internet media services. The Company provides network download, video playback, digital content, online game, and other related services.

Xunlei (XNET US)

Negative EVs: JOYY & Sohu's Steep Discount To Net Cash

I'd tilt slightly towards Sohu. It did successfully sell Sogou; whereas Joyy failed to sell YY live. That may provide some insight as to how the...

David Blennerhassett

Coronavirus Casualties: China Tech's Ten Biggest Losers

Since coronavirus fears gripped markets, the majority of Chinese tech stocks have experienced sharp selloffs with travel-related names being...

Vincent Fernando, CFA