Is China Automotive Systems, Inc. overvalued or undervalued?

As of 14 May 2024, the valuation grade for China Automotive Systems, Inc. has moved from very attractive to attractive. The company appears to be undervalued based on its current metrics. The P/E ratio stands at 4, significantly lower than the industry average, while the price-to-book value is 0.38, indicating a strong asset backing. Additionally, the EV to EBITDA ratio is 1.65, suggesting that the company is trading at a low multiple relative to its earnings potential.
In comparison to peers, China Automotive Systems, Inc. has a P/E of 3.70, while PHINIA, Inc. is considered very expensive with a P/E of 18.52, and China Yuchai International Ltd. is also attractive with a P/E of 8.31. The dividend yield of 17.99% further enhances its attractiveness to investors. Despite a recent slight decline in stock price, the company's performance over the past year has been comparable to the S&P 500, reinforcing its undervalued status.