JD

Essential Facts About JD.com

A strong performer from today's evening trading session is JD.com, whose shares rose 3.6% to $27.6 per share. For those of you thinking about investing in the stock, here is a brief value analysis of the stock using the company's basic fundamental ratios.

An Exceptionally Low P/B ratio but Trades Above Its Graham Number:

JD.com, Inc. provides supply chain-based technologies and services in the People's Republic of China. The company belongs to the Consumer Discretionary sector, which has an average price to earnings (P/E) ratio of 22.96 and an average price to book (P/B) ratio of 4.24. In contrast, JD.com has a trailing 12 month P/E ratio of 13.0 and a P/B ratio of 0.19.

JD.com's PEG ratio is 23.3, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.

Low Leverage Levels and Exceptional EPS Growth:

2018 2019 2020 2021 2022 2023
Revenue (MM) $67,198 $82,865 $114,299 $149,326 $151,690 $151,690
Revenue Growth n/a 23.31% 37.93% 30.64% 1.58% 0.0%
Operating Margins 0% 2% 7% 5% 2% 2%
Net Margins 0% 2% 43% 33% 7% 7%
Net Income (MM) -$2 $1,750 $49,248 $49,248 $10,210 $10,210
Net Interest Expense (MM) $202 $772 $4,989 $4,989 $305 $305
Depreciation & Amort. (MM) $3,533 $4,673 $5,037 $5,037 $5,295 $5,295
Earnings Per Share -$0.01 $0.59 $2.43 $2.43 $0.47 $0.47
EPS Growth n/a 6000.0% 311.86% 0.0% -80.66% 0.0%
Diluted Shares (MM) 2,911 2,967 3,109 3,109 3,181 3,181
Free Cash Flow (MM) $3,127 $2,489 $6,520 $5,765 $7,510 $7,586
Current Ratio 0.97 0.99 1.35 1.35 1.32 1.32
Total Debt (MM) $2,928 $2,474 $3,364 $5,213 $11,203 $12,288
Net Debt / EBITDA -0.69 -0.43 -0.77 -0.62 -0.03 0.1

JD.com has exceptional EPS growth and low leverage. Additionally, the company's financial statements display growing revenues and decreasing reinvestment in the business and irregular cash flows. However, the firm has weak operating margins with a positive growth rate.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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