TY - JOUR T1 - Valuation of Chinese Equity Based on Implied Growth Rates JF - The Journal of Investing SP - 53 LP - 66 DO - 10.3905/joi.2015.24.1.053 VL - 24 IS - 1 AU - Zhongming Liu AU - Daniel J. Borgia AU - Travis L. Jones Y1 - 2015/02/28 UR - https://pm-research.com/content/24/1/53.abstract N2 - This article introduces a valuation method that can be used to back out the short-term expected growth rate implied in the prices of Chinese stocks. The proposed methodology involves reverse-engineering the traditional DCF models, which is then applied to a sample of 467 listed Chinese companies. Our findings show that the implied growth rate generally is much higher than its actual realization, with all median estimation errors larger than 90%. This study has practical applications for investors and traders, since it does not require access to private information or analysts’ estimations and provides a useful tool to critically evaluate Chinese stock prices.TOPICS: Fundamental equity analysis, emerging ER -