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Medium and special valuations are a special type of valuation that is different from the general one. The general ** is determined by market supply and demand, that is, the psychological expectations of the buyer and the seller determine the value of **.
Generally speaking, the special valuation** mainly includes the following categories:
1. State-owned enterprises**
These are influenced by national policies and usually have a higher P/E ratio, that is, they are higher than their profitability. This is because state-owned enterprises have strong policy guarantees, will not be easily bankrupt or acquired, and also have a more stable dividend policy, therefore, investors are willing to pay a higher premium for them.
The representatives of state-owned enterprises are: PetroChina, Sinopec, Guodian Power, etc.
2. Military industry**:
These are affected by defense needs and typically have a higher price-to-book ratio, that is, they are higher than their book value. This is because the military industry has strong technical barriers, will not be threatened by competitors, and also has more stable orders**, therefore, investors are willing to pay a higher premium for them.
The representatives of the military industry are: aerospace science and technology, aerospace power, China Shipbuilding Heavy Industry, etc.
3. Bank**:
These are subject to financial regulation and usually have lower P/E ratios, that is, they are lower than their profitability. This is because banks** have higher capital requirements, are less likely to expand or merge easily, and have stricter lending regulations, so investors have lower expectations for them.
The representatives of the bank** are: Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China, etc.
In general, the advantages of Zhongte Valuation are that it has less volatility, stable returns, lower risk, is suitable for long-term holding, suitable for investors with fixed income, and suitable for risk-averse investors.
The disadvantage of the special valuation is that the growth potential is limited, it is difficult to generate excess returns, and it is not suitable for investors who pursue high returns, nor is it suitable for investors who operate in the short term.