Autohome’s Prospects for Capital Allocation

Autohome’s Prospects for Capital Allocation

China's leading online destination for cars is growing fast and drowning in cash. We discuss Autohome's prospects for capital allocation and attempt a valuation of the business.
Office at Autohome Inc
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In chess, there’s a viable strategy called seizing the middle. By seizing control of the middle board, a player maximizes the potential moves and controls the movement of the maximum number of pieces.

In China, there’s a tech company utilizing this strategy. And it has beaten all its competitors who have tried to do the same thing.

This company is Autohome and it sits right in the center of the automobile industry by seeking to effectively link each stage of a car buyer’s ownership life cycle with the corresponding stage of their customers’ sales cycle.

Autohome has been a holding in the Junto investment portfolio since March 20, 2020, and you’ll soon learn why.

At its core, Autohome is a content platform delivering comprehensive content to automobile consumers through its websites, autohome.com.cn and che168.com, and associated mobile apps. This content is both professionally generated, user-generated, and (increasingly) interactive covering the entire car purchase and ownership cycle.

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