Bank of China (SEHK:3988): Assessing Valuation Following Q3 2025 Earnings and Steady Income Growth

Bank of China (SEHK:3988) has just published its financial results for the third quarter and the first nine months of 2025. The latest report highlights a modest year-on-year increase in net income and steady basic earnings per share for the period.

See our latest analysis for Bank of China.

Bank of China’s latest earnings update seems to have energized investors. After the results dropped, the stock notched a 1.3% gain in a day and capped a strong 11.2% share price return over the past month. Zooming out, its one-year total shareholder return now stands at an impressive 36.8%, with multiyear holders enjoying a stellar 116% return over three years. With executive changes also announced, momentum is clearly building as the bank continues to show resilience and attract attention in Hong Kong’s financial sector.

If you’re interested in spotting what else is trending beyond the big names, now’s the perfect moment to broaden your search and discover fast growing stocks with high insider ownership

With Bank of China posting solid returns and reporting steady earnings growth, investors now face a key question: Is the stock still undervalued with room to run, or is future growth already fully priced in?

Most Popular Narrative: 10.1% Undervalued

According to the prevailing narrative, Bank of China’s fair value is pegged at HK$5.19, about 10% above the last closing price of HK$4.67. This gap is drawing attention to the stock’s upside potential and focusing the spotlight on what is driving analyst optimism.

The rapid adoption of digital payments, fintech, and artificial intelligence, in which Bank of China is making significant investments, is expected to enhance customer engagement, lower operational costs, and increase product innovation. This could lead to greater operating efficiency and potential margin expansion.

Read the complete narrative.

Want to know what is fueling this fast-rising fair value? The pivotal assumptions revolve around a mix of bold revenue expansion and a future earnings multiple typically reserved for industry disruptors. Do not miss the hidden catalysts pushing this stock higher. Tap for the full financial story behind this valuation.

Result: Fair Value of $5.19 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing asset quality pressures and a persistently low interest rate environment could weaken future earnings and challenge this positive outlook.

Find out about the key risks to this Bank of China narrative.

Another Perspective: Comparing Share Price to Earnings

Taking a different approach, Bank of China's share price is currently trading at 6.2 times earnings. That is only slightly above the industry average of 6 and below the peer average of 6.8, suggesting the stock is reasonably priced. However, the fair ratio stands at 7.1, which implies there could still be some upside if the market re-rates the company. But with the stock already close to sector norms, is the opportunity as big as it seems, or does it highlight some lasting risks?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Bank of China Narrative

If you have a different perspective or want to dive deeper into the numbers yourself, crafting your own view is quick and easy. Do it your way

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Bank of China.

Looking for More Investment Ideas?

Your smartest moves are often just one good idea away. Don’t let the best stocks pass you by when you can find fresh inspiration with these handpicked collections:

• Spot the potential for high yields by reviewing these 16 dividend stocks with yields > 3%, which offers attractive income opportunities above 3%.
• Tap into the fast-evolving world of digital assets and follow the momentum leaders among these 82 cryptocurrency and blockchain stocks.
• Get ahead of the next medical breakthroughs by checking out these 32 healthcare AI stocks, a selection making waves in AI-driven healthcare innovation.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com