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QuestionsCategory: Investor PsychologyPE Ratio Question
Theodore Tan asked 2 years ago

Hi Victor, 
Previously I asked a question on Alibaba that is listed in the USA and Alibaba (9988) that is listed in the HKex.
I was advised to look at the annual report of Alibaba in the USA to price the stock of Alibaba (9988) in the HKex).
My question is, I think I should use the PE ratio to price 9988.
However I have one doubt.

  1. Is the PE ratio that is used in the USA applicable to the HK market?
  2. From your experience, for the same type of industry, is the range of PE the same across different markets such as USA or HK?


1 Answers
Victor Chng answered 2 years ago

Hi Theodore,

  1. The PE ratio valuation of Alibaba in US and HK is the same as the company is dual listed.
  2. PE range are usually the same for company listed in the same exchange because investor in each exchange view the stock differently.