Looking forward to 2021, new era Securities said that due to the rise in roe, the valuation of cycle stocks and optional consumption will continue to rise. In an optimistic situation, it may last until the middle of 2021. Financial stocks will be the latest sector to show a rise in valuation, which is worthy of close attention of investors.
From the perspective of specific investment strategies, banks, insurance, securities companies and other financial brothers have different investment strategies.
The most promising sector in 2021 is the securities sector, followed by the insurance and banking sector. Xu Qiongna, general manager of Baomai investment, said in an interview with a reporter from Securities Daily that there are four logics for optimistic about securities companies. First, the performance of securities companies this year is very good, and the industry as a whole has increased significantly year on year for two consecutive quarters. At present, the market valuation is not high, and there are everywhere with the P / E ratio below 1 times and the P / E ratio below 10 times. Second, in the medium and long term, the market is in a slow structural bull. Both the registration system and the support of the direct financing policy are good for securities companies in the long run. Third, from the perspective of social investment structure, with more than 2 trillion yuan of new public funds raised this year, the performance of securities companies has benefited significantly from the scale growth of public funds. Fourth, the current monetary + credit policy has not changed. The rise of a financial cycle, leading securities companies usually have 3-5 times of profits. In the future, after the securities sector has been launched substantially, it is expected to gradually switch to the banking or insurance sector, with different investment orders.
From the valuation point of view, Securities Daily reporter found that, as of November 20, the latest dynamic P / E ratios of securities, insurance and banks were 23.7 times, 14.6 times and 6.14 times, respectively. The P / E ratios of banks and insurance sectors were far lower than 22.58 times of a shares. It is worth noting that in terms of P / B ratio, the latest P / B ratio of 27 bank stocks in the banking sector is less than 1 times, accounting for 73% of the constituent stocks in the industry. The latest P / B ratio of Huaxia Bank, Bank of communications and Minsheng Bank is less than 0.5 times.
From the perspective of valuation level, we are more optimistic about the performance of insurance, banking and other financial sectors in the future. Zhuang Hongdong, a cheese fund manager interviewed by Securities Daily, believes that at present, both insurance and banks are at a low level in terms of valuation. With the establishment of economic recovery, as a post cyclical sector, the future environment is conducive to the improvement of the performance of banks and insurance. In terms of insurance, with the gradual recovery of the economy, at present, some insurance companies have rebalanced their business structure, and their strategies will be more active. Next years insurance industry is expected to make a good start. It can be seen that some leading insurance companies with better transformation have built competitive advantages in the industry reform, and their investment value has been highlighted. In addition, since May, the return on treasury bonds has rebounded, and the government has opened up the investment scope of insurance funds in the primary market, which is conducive to improving the investment income of insurance companies. For banks, valuations are also low. With the continuous recovery of the economy, investment demand and consumption demand are growing, which has a good role in promoting bank loans. From the perspective of asset quality, the recovery of corporate profitability, corporate repayment pressure and default problems are alleviated, which is conducive to improving the asset quality of banks. At present, the banks undervalue also makes it have a better defensive attribute.
In short, for the next year, securities companies generally hold an optimistic view that many factors promote A-share to take on a new pattern, and Chinas capital market will enjoy long bull. CITIC Securities said that in 2021, the slow rise of a shares will go through three stages, namely, the rotation slow rise period, the quiet period and the resonance upward period. In terms of configuration, it is suggested to closely follow the industrial boom and give consideration to the theme of policy catalysis. It is suggested to increase the allocation of big finance. In 2021, the long period of credit risk mitigation will gradually enter the end, and the external macro variables will be added to improve the internal profitability. The bank valuation center is expected to increase in trend and can be actively deployed.
Source of this article: Guo Chenqi, editor in charge of Securities Daily_ NBJ9931