The so-called high-quality companies refer to the quality of each indicator: main business income continues to grow steadily, stable cash flow , return on equity is higher than 10%, low price-to-earnings ratio , low price-to-book ratio, industry prospects are positive, industry leaders! Gree Electric Appliances in home appliances, China Ping An in insurance companies!
fell below the platform and continued to fall sharply, which means that the company's stock price fell below the platform for a period of time, and it is a common method used by institutions, and it is also the last wave of crazy washing of the market before the rise. The purpose of this is to force retail investors to hand over their chips and absorb a large amount of and at a low level. This kind of chip is bloody. Below we will explain this phenomenon one by one through the trends of high-quality companies over the years.
China Railway Construction (601186) industry leader. Performance continued to grow steadily, with a compound growth rate of 12%, and a return on net assets of 12%. From February 20 to March 12, 2014, China Railway Construction (601186) fell below the platform and continued to fall, with a minimum price-to-earnings ratio of 5 times and a price-to-book ratio of 0.6 times. After continuous sharp declines, it continued to rise sharply, with the highest increase of in one year 47 times.
CICC (601066): Leading the securities industry, with a compound growth rate of performance of 20%, a return on net assets of 14%, from September 28 to October 12, 2018 to a large-scale decline, with a minimum price-to-earnings ratio of 1.2 times and a price-to-earnings ratio of 13 times. After a sharp drop, it rose continuously, with a 5-fold increase in half a year.
Jiuguijiu (000779): Leading the liquor industry, with a compound growth rate of performance of 30%, and a return on net assets of 18%. From March 11 to 23, 2020, it fell sharply and fell continuously. At this time, the price-to-earnings ratio was 30 times and the price-to-book ratio was 4 times. Affected by the huge increase in performance, the increase in August was 8 times.
China Mining Resources (002738): lithium mine resource stocks, with a compound growth rate of 70%, and a return on net assets of 17%. It has been falling sharply from March 1 to 25, 2021, with a minimum price-to-earnings ratio of 13 times and a price-to-book ratio of 2 times. It has increased by 3 times in March due to the sharp increase in performance.
Xia Tungsten New Energy (6886788) new energy stocks, the compound growth rate of performance is 80%, and the return on net assets is 22%. From April 1 to 29, 2022, the platform has continued to increase its volume and fall continuously, with the lowest price-to-earnings ratio of 24 times and the price-to-book ratio of 4 times. It continued to rise sharply, with a 3-fold increase in March.
Let’s summarize the rules below. First of all, the company must choose a high-quality leading company with high-quality fundamentals. A certain place is affected by the decline of market . The trend shows a decline in the platform and continues to increase volume and continue to fall. When the price-to-earnings ratio and price-to-book ratio are undervalued, this is a great opportunity for us to pick up money. At this time, the operation is simple and clear. Buy and hold, and wait for the flowers to bloom!
