Top 5 stock recommendations October

New to investment and don’t know what to invest on for the long term? Don’t worry I got you

if you wanna know how to stock pick for long term, read up my other post about it!

How to stock pick!

✅ Alibaba ✅

This is the best bargain stock to buy now in my opinion. People that know me know that I’m always bullish on Chinese stocks. They’re severely undervalued and waiting for growth opportunities. Look it up, Alibaba peaked at about $310 before dropping to $112 as we’re speaking. I’ve explained about the decline in my other post.

About the China market

Hence, when China government is finally giving support to Chinese companies, it’s time for them to take over. Time to get Chinese stocks at a bargain guys.

Benjamin Graham recommends that growth stocks that are lower than 25 P/E ratio are not overvalued and fortunately for you guys, Alibaba is trading at around 24.5 PE ratio.

just a recap, P/E ratio means Price:Earnings ratio, to calculate this, you drive the market price by the earnings per share and as such you get around 24.5. Which means that you’re paying $24.5 for every $1 the company is earning

If you ask me, that’s very reasonable for a value growth stocks

Now let’s look at the values Alibaba can bring

The businesses they own, includes globally known

e-commerces: TaoBao, Tmall, AliExpress and Lazada

Cloud: Aliyun (One of the largest cloud provider)

Digital payment: Ant group (Alipay)

Logistics: CaiNiao

Media: YouKu

Food delivery: Eleme

large investment in Ai and semiconductors. Baba made 800 million investment in Moonshot Ai as well as other Ai startups

They also developed their own chips in house so that they won’t have to be dependent on the US chips. If yall didn’t know, US actually banned intel chips from shipping to China and baba was China’s saviour. Hence a conglomerate like them will never be bankrupt and they’re very stable. It’s about time the world recognise their potential.

Over the past few years, they’ve minimised their investments and focused on improving their operating incomes and capitals. They still maintain strong asset value even with a lot of setback the past 5 years. Just take a look at their balance sheets on Yahoo finance.

✅ Pin Duo Duo ✅

TaoBao’s direct competitor

Pin duo duo is famous for their bargain group buy, allowing users to purchase items at a cheaper price when bid together with strangers.

They appeal to the less developed crowd and are appealing to users globally as well with expansion of e-commerce such as Temu.

Temu is super big in US

Pdd is always super focused on the agriculture industry where they connect buyers to farmers directly, reducing the need for middle parties, hence, further reducing cost

As such, pdd experienced rapid growth in user base and become a threat to TaoBao. They’ve a PE ratio of 33 now which is slightly higher but also means that this is the price people are willing to pay for PDD at this point in time

✅ Tencent ✅

The biggest Chinese conglomerate and 1 of my favourites. It’s so stable that if there’s 1 company that’ll last till the end in China, it’ll be this company. Every product this company comes out with is such a huge deal

Social media: WeChat, QQ

Games: Riot games (LOL), Epic games, 王者荣耀, PUBG, WuKong, etc

Tencent cloud services one of the biggest in China

Delivery and lifestyle: Meituan Dianping

If there’s ANY company that’s ever getting close to the metaverse, it’s Tencent. Don’t sleep on them. Although they’re a value company now, there’s so much room for future growth. The day they come up with metaverse is the day they gonna POP OFF like crazy. And it’s not even insane anymore. Metaverse is the integration of social media and games in a virtual world. Tencent has the BIGGEST social media and gaming capabilities. It’s just bringing of them together

✅ Nio ✅

It’s about time guys. Nio is trading at about $7 as we’re speaking and they’ve a negative 25 PE ratio. This means that the company is not profitable yet. However, Nio has come a long long way. This year they’ve proven themselves to be a business to stay. They’re expanding their product lines with EC6 and ET7, attracting more user base, a showcase of their manufacturing processes and how they ramped up production capabilities, market penetration in China and EU and still looking to expand in more countries, unique battery swapping and renting technology, current government support, around 20% increase in delivery as compared to last year.

It’s about time guys. Nio peaked at around $62. I won’t expect them to go back to that price in a year time but I’ll say they’ll grow.

✅ Tesla ✅

Tesla currently has a PE ratio of about 66 and I know it seems super overvalued but hey guys, we all know never to belittle Elon musk and his leadership. If you had believed in him in 2016 and just invested ONLY $1000 USD, today you would’ve made $65.782 USD. And he’s not gonna stop. He’s a futuristic man and for the short term, he’s fully invested in FSD technology and the product lineup for Tesla and their specs is getting better and better. Imagine cyber truck, a freaking truck going 0-60 in 2.8s. That’s super car speed and their SUV model X plaid going 0-60 in 2.5a. That’s freaking insane

In the long future, Elon musk is investing in neuralink, implementing chips in people’s brains and they’re already starting experiments… those black mirror episodes you’ve watching aren’t crazy anymore. Also, he’s coming up with XAI, A direct competition to OpenAI or rather chatgpt, just that it’s much more transparent than ChatGPT, resolving the black box doubts corporates have about ChatGPT. I won’t be surprised when Elon integrated XAI with Tesla when the technology is fully ready. Lastly, don’t forget SpaceX. Tesla is not just an automobile company, they’re a tech company and it’s time we see them as who they are.

Alright, that’s my take on the growth stocks of the future :) invest at your own risk and do your own research guys

Take a good read on my other post as well to learn more!

Basics on investment

How to read financial statements

Economy behind the stocks market

Basics on options

Everything you need to know about Bonds