ZTE (000063.SZ)
Technology · Shenzhen · China
Fundamentals
Valuation and ratings
ZTE trades at CN¥36.04, which is 55% above the CN¥16.21 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 42 out of 100, which is little in the way of a moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 44.1 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About ZTE
ZTE Corporation provides integrated information and communication technology solutions in the People's Republic of China, rest of Asia, Africa, Europe, America, and Oceania. It operates through three segments: Carriers' Networks, Consumer Business, and Government and Corporate Business. The Carriers' Networks segment provides wireless and wireline access, bearer systems, core networks, server and storage, and other technologies and product solutions. The Consumer Business segment focuses on the development, production, and sale of home information terminals, smart phones, mobile internet terminals, and fusion terminals, as well as provides related software application and value added services. The Government and Corporate Business segment offers informatization solutions for the government and corporations through the application of products, including communications networks, IoT, big data, and cloud computing. The company was founded in 1985 and is headquartered in Shenzhen, the People's Republic of China.
000063.SZ passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is ZTE (000063.SZ) undervalued?
Against our discounted cash flow estimate of CN¥16.21, 000063.SZ at CN¥36.04 is 55% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is 000063.SZ's P/E ratio?
000063.SZ trades at 44.1 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.