Bank of China Limited

SZSC:3988 Stock Report

Market Cap: HK$1.5t

Bank of China Valuation

Is 3988 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of 3988 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 3988 (HK$3.76) is trading below our estimate of fair value (HK$11.53)

Significantly Below Fair Value: 3988 is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 3988?

Key metric: As 3988 is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for 3988. This is calculated by dividing 3988's market cap by their current earnings.
What is 3988's PE Ratio?
PE Ratio4.7x
EarningsCN¥217.51b
Market CapCN¥1.35t

Price to Earnings Ratio vs Peers

How does 3988's PE Ratio compare to its peers?

The above table shows the PE ratio for 3988 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average4.7x
939 China Construction Bank
4.3x4.1%HK$1.5t
1288 Agricultural Bank of China
4.9x5.6%HK$1.8t
1398 Industrial and Commercial Bank of China
4.5x4.2%HK$2.2t
1658 Postal Savings Bank of China
5.2x6.5%HK$547.7b
3988 Bank of China
4.7x5.1%HK$1.5t

Price-To-Earnings vs Peers: 3988 is good value based on its Price-To-Earnings Ratio (4.7x) compared to the peer average (4.7x).

Price to Earnings Ratio vs Industry

How does 3988's PE Ratio compare vs other companies in the HK Banks Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
No more companies available in this PE range
3988 4.7xIndustry Avg. 4.7xNo. of Companies12PE0612182430+
0 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: 3988 is expensive based on its Price-To-Earnings Ratio (4.7x) compared to the Hong Kong Banks industry average (4.7x).

Price to Earnings Ratio vs Fair Ratio

What is 3988's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

3988 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio4.7x
Fair PE Ratio5.3x

Price-To-Earnings vs Fair Ratio: 3988 is good value based on its Price-To-Earnings Ratio (4.7x) compared to the estimated Fair Price-To-Earnings Ratio (5.3x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst 3988 forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentHK$3.76
HK$4.09
+8.9%
10.1%HK$4.67HK$3.37n/a16
Nov ’25HK$3.76
HK$4.14
+10.1%
9.8%HK$4.75HK$3.42n/a16
Oct ’25HK$3.67
HK$4.12
+12.4%
9.7%HK$4.93HK$3.43n/a16
Sep ’25HK$3.54
HK$4.14
+16.9%
9.2%HK$4.95HK$3.44n/a16
Aug ’25HK$3.43
HK$4.10
+19.5%
8.8%HK$4.86HK$3.37n/a16
Jul ’25HK$3.85
HK$4.03
+4.8%
9.2%HK$4.84HK$3.36n/a17
Jun ’25HK$3.70
HK$3.89
+5.2%
12.2%HK$4.84HK$2.67n/a17
May ’25HK$3.53
HK$3.70
+4.8%
12.3%HK$4.84HK$2.67n/a17
Apr ’25HK$3.23
HK$3.62
+12.2%
12.3%HK$4.39HK$2.48n/a16
Mar ’25HK$3.08
HK$3.52
+14.4%
8.9%HK$4.18HK$2.71n/a16
Feb ’25HK$2.93
HK$3.50
+19.4%
10.2%HK$4.21HK$2.73n/a17
Jan ’25HK$2.98
HK$3.57
+19.9%
11.6%HK$4.31HK$2.74n/a17
Dec ’24HK$2.83
HK$3.57
+26.2%
11.7%HK$4.27HK$2.72n/a18
Nov ’24HK$2.77
HK$3.51
+26.8%
11.9%HK$4.19HK$2.65HK$3.7618
Oct ’24HK$2.74
HK$3.47
+26.7%
11.4%HK$4.20HK$2.70HK$3.6718
Sep ’24HK$2.66
HK$3.50
+31.6%
11.4%HK$4.38HK$2.72HK$3.5419
Aug ’24HK$2.87
HK$3.65
+27.1%
14.6%HK$5.23HK$2.75HK$3.4318
Jul ’24HK$3.14
HK$3.66
+16.6%
14.0%HK$5.23HK$2.72HK$3.8517
Jun ’24HK$3.05
HK$3.66
+20.0%
14.8%HK$5.22HK$2.66HK$3.7018
May ’24HK$3.13
HK$3.58
+14.5%
11.1%HK$4.24HK$2.72HK$3.5316
Apr ’24HK$3.01
HK$3.58
+18.9%
12.9%HK$4.32HK$2.74HK$3.2316
Mar ’24HK$2.94
HK$3.64
+23.7%
12.9%HK$4.43HK$2.78HK$3.0818
Feb ’24HK$3.00
HK$3.66
+22.0%
12.6%HK$4.44HK$2.79HK$2.9319
Jan ’24HK$2.84
HK$3.60
+26.6%
12.8%HK$4.36HK$2.74HK$2.9819
Dec ’23HK$2.73
HK$3.48
+27.5%
11.4%HK$4.24HK$2.75HK$2.8320
Nov ’23HK$2.55
HK$3.41
+33.5%
11.2%HK$4.14HK$2.68HK$2.7720

Analyst Forecast: Target price is less than 20% higher than the current share price.

Discover undervalued companies

Bank of Qingdao

HK$20.8b

Provides various banking products and services in the People’s Republic of China.

3866

HK$2.76

7D

-1.4%

1Y

38.0%

China Construction Bank

HK$1.5t

Engages in the provision of various banking and related financial services to individuals and corporate customers in the People's Republic of China and internationally.

939

HK$6.03

7D

-0.3%

1Y

30.5%

Bank of Qingdao

HK$20.8b

Provides various banking products and services in the People’s Republic of China.

3866

HK$2.76

7D

-1.4%

1Y

38.0%