Autohome Inc. (NYSE:ATHM) Increases Engagement: Is ATHM One of the Cheapest Chinese Stocks to Buy?

Autohome Inc. (NYSE:ATHM), a leading online destination for automobile consumers in China, has witnessed a significant increase in user engagement, with its number of average mobile daily active users growing by 8.3% year-over-year to reach 67.91 million in June 2024. This growth can be attributed to the company's diverse and high-quality content offerings, bolstered by its strong IP content matrix, which consistently expands its user base and enhances user engagement. Additionally, Autohome's innovative business initiatives, such as the launch of its Satellite Plan in May 2024, have accelerated its network expansion and facilitated deeper penetration into broader geographical markets. This growth in user engagement is sustainable, as Autohome continues to explore new business areas and leverage Ping An's resources to enhance its long-term industry competitiveness.

Autohome's revenue and earnings growth have been robust, with a 3.51% increase in revenue to 7.18 billion in 2023, and a 4.03% increase in earnings to 1.88 billion. However, its growth rate is lower than some of its peers in the Chinese stock market, such as Alibaba Group Holding Ltd. (NYSE:BABA), which reported a 12% increase in revenue in 2023. Despite this, Autohome's strong financial performance and growth potential make it an attractive investment opportunity.

Autohome's expansion into lower-tier cities via its Satellite Plan has accelerated network growth, facilitating deeper penetration into broader geographical markets. This initiative has contributed to a substantial increase in user traffic, with average mobile daily active users growing by 8.3% year-over-year to reach 67.91 million in June 2024. This growth in user engagement has likely driven financial performance, as evidenced by a 3.51% increase in revenue to 7.18 billion CNY in 2023. Despite this growth, ATHM's valuation remains attractive, with a trailing PE ratio of 13.64 and a forward PE ratio of 12.48, suggesting it may be one of the cheapest Chinese stocks to buy.

Autohome Inc. (NYSE: ATHM) offers an attractive dividend yield of 6.23% and a shareholder yield of 7.65%, making it one of the most enticing Chinese stocks for income-oriented investors. Its dividend payout ratio of 84.99% suggests a sustainable distribution, supported by robust earnings growth. While ATHM's dividend growth history is limited, its commitment to distributing RMB1.5 billion annually indicates potential for future increases. Compared to peers like Baidu (NASDAQ: BIDU) with a 1.4% yield and Alibaba (NYSE: BABA) with a 1.2% yield, ATHM stands out as a compelling choice for income investors seeking exposure to the Chinese market.



In conclusion, Autohome Inc. (NYSE:ATHM) has demonstrated strong user engagement growth and attractive financial performance, positioning it as a potential bargain in the Chinese stock market. Its innovative business initiatives and expansion into lower-tier cities have driven user engagement and financial success, while its attractive valuation and dividend yield make it an appealing investment opportunity for income-oriented investors. As Autohome continues to explore new business areas and leverage Ping An's resources, its long-term industry competitiveness is expected to remain strong.