Chinese tech and AI stocks are attracting increased investment demand amid elevated valuations in the U.S. With the S&P 500 (SPX) trading at a forward price-to-earnings (P/E) ratio of 23.2x and the Nasdaq 100 (NDX) at 25.3x, some investors are diversifying to Chinese stocks with lower valuations and similar potential.
Claim 70% Off TipRanks This Holiday Season
- Unlock hedge-fund level data and powerful investing tools for smarter, sharper decisions
- Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential
“While the U.S. remains the leader in frontier AI, China is rapidly narrowing the gap,” said Gemma Cairns-Smith, Investment Specialist at Ruffer. “The moat may not be as wide, or as deep, as many think… The competitive landscape is shifting.”
UBS Sees Chinese Tech as ‘Most Attractive’ amid AI Boom
Earlier this month, UBS characterized Chinese tech stocks as “most attractive,” driven by quick AI monetization and the Chinese government’s goal of technological self-reliance. A spurt of AI-related IPOs in recent months, including Moore Threads and MetaX, has also led to elevated interest.
On the other hand, some analysts doubt China’s position in the AI race. North of South Capital Portfolio Manager Kamil Dimmich believes that many Chinese chip companies are “almost entirely driven by hype” and lack valuation support.
Stay ahead of macro events with our up-to-the-minute Economic Calendar — filter by impact, country, and more.