Tuesday, Credit Suisse upgraded E-House China Holdings Limited (EJ) shares to Outperform with a price target of $17.42.
Analyst Cheng noted that year-to-date average transaction volume for major cities in China grew 77% year-over-year, leading him to believe that the property market bottomed out in 2008 and is trending towards a recovery. This is also evidenced by stable property prices and developer interest in buying land.
The analyst forecasts E-House's GFA sold will grow 75% in 2009 or 7.2 million square meter on 15-17 million square meter available for sale this year. Given E-House's historical sell-through rate of 60-70%, the analyst believes his forecasts are reasonable. Its consultancy business grew 46% year-over-year in first quarter of 2009, and is on track to grow at least 30% in fiscal 2009, after a 480% rise in fiscal 2008.
The analyst's price target of US$17.42 employs a SOTP valuation of 20x P/E (vs historical average of 21x) for its non-cash fiscal 2009 P/E and US$3.18 net cash per share. The analyst believes this is justified as he forecasts E-House's earnings to see a CAGR of 29.4% over 2009-2011.
Currently, EJ is down $0.52 or 3.32% and trading at $15.15.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.