Aluminum Corporation Of China (SEHK:2600) Reports Stronger Half Year Earnings, Is It Still Undervalued?

Aluminum Corporation of China (SEHK:2600) drew fresh attention after reporting half year 2026 earnings, with sales of CNY 125,413.19m and net income of CNY 11,871.38m, alongside higher basic and diluted earnings per share.

At a share price of HK$8.765, Aluminum Corporation of China has seen a 1-day share price return of 3.61% and a 7-day return of 4.35%. However, the share price is down 30.66% year to date and 19.59% over 90 days, while longer term total shareholder returns of 31.88% over 1 year and 156.48% over 3 years suggest recent momentum has faded compared with earlier gains.

Compare Aluminum Corporation of China’s latest earnings shift with peers by scanning hand picked 9 top copper producer stocks that are also tied to metals demand and large scale industrial spending.

After Aluminum Corporation of China’s sharp pullback this year, combined with stronger recent earnings, the setup is not straightforward for new buyers. Do the current numbers and price still tilt the risk reward in your favour as an owner?

Price-to-Earnings of 7.4x: Is it justified?

Aluminum Corporation of China is currently flagged as trading on a P/E of 7.4x, which is described as good value compared with both peers and the wider Hong Kong Metals and Mining industry.

The P/E ratio compares the company’s share price with its earnings per share. For a business like Aluminum Corporation of China, with exposure to alumina, primary aluminum and related energy operations, this metric helps you see how much the market is paying for each unit of profit.

Here, a 7.4x P/E sits well below the industry average of 14.4x and also below the estimated fair P/E of 10.5x. That suggests the current market price is placing a lower value on Aluminum Corporation of China’s earnings than both its sector and the level the SWS fair ratio indicates the market could move toward if pricing aligned more closely with fundamentals.

Explore the SWS fair ratio for Aluminum Corporation of China

Result: Price-to-Earnings of 7.4x (UNDERVALUED)

However, Aluminum Corporation of China still faces risks if metals demand weakens or if energy and raw material costs squeeze margins and reduce the appeal of its current P/E ratio.

Find out about the key risks to this Aluminum Corporation of China narrative.

Another view on Aluminum Corporation of China’s value

The P/E of 7.4x suggests Aluminum Corporation of China looks cheap on earnings. However, our DCF model points to an estimated future cash flow value of HK$33.86 per share versus the current HK$8.77. That is a very large gap. Is the market overreacting to risk, or is the model too optimistic?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Aluminum Corporation of China for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 262 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

The mix of risks and rewards around Aluminum Corporation of China will feel different for every investor, so act while the numbers are fresh and build your own view by weighing the 3 key rewards and 1 important warning sign.

Looking for more investment ideas beyond Aluminum Corporation of China?

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• Target potential mispricings by reviewing a 262 high quality undervalued stocks that screens for quality businesses trading below what their fundamentals may suggest.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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