PDD

PDD Investors, You Need to Know These Facts Today.

Now trading at a price of $142.8, PDD has moved -2.1% so far today.

PDD returned gains of 101.2% last year, with its stock price reaching a high of $164.69 and a low of $66.4. Over the same period, the stock outperformed the S&P 500 index by 77.2%. More recently, the company's 50-day average price was $131.24. PDD Holdings Inc., a multinational commerce group, owns and operates a portfolio of businesses. Based in Dublin, Ireland, the Large-Cap Consumer Discretionary company has 17,403 full time employees. PDD has not offered a dividend during the last year.

Wider Gross Margins Than the Industry Average of 43.64%:

2018 2019 2020 2021 2022 2023
Revenue (M) $1,908 $4,330 $9,118 $14,743 $18,929 $34,879
Gross Margins 78% 79% 68% 66% 76% 63%
Net Margins -78% -23% -12% 8% 24% 24%
Net Income (M) -$1,486 -$1,001 -$1,100 $1,219 $4,573 $8,455
Net Interest Expense (M) $11 $21 $116 $193 $7 $6
Depreciation & Amort. (M) $72 $92 $100 $235 $322 $111
Diluted Shares (M) 2,968 4,627 4,768 5,714 5,761 5,840
Earnings Per Share -$0.5 -$0.22 -$0.23 $0.21 $0.79 $1.45
EPS Growth n/a 56.0% -4.55% 191.3% 276.19% 83.54%
Free Cash Flow (M) $1,126 $2,125 $4,315 $4,486 $7,013 $13,226
CAPEX (M) $4 $4 $7 $31 $20 $36
Current Ratio 1.66 1.6 1.78 1.72 1.85 1.93

PDD benefits from rapidly growing revenues and increasing reinvestment in the business, exceptional EPS growth, and generally positive cash flows. The company's financial statements show wider gross margins than its peer group and a decent current ratio of 1.93.

an Exceptionally Low P/B Ratio but Priced Beyond Its Margin of Safety:

PDD has a trailing twelve month P/E ratio of 17.1, compared to an average of 22.06 for the Consumer Discretionary sector. Based on its EPS guidance of $15.95, the company has a forward P/E ratio of 8.2. According to the 64.7% compound average growth rate of PDD's historical and projected earnings per share, the company's PEG ratio is 0.26. Taking the weighted average of the company's EPS CAGR and the broader market's 5-year projected EPS growth rate, we obtain a normalized growth rate of 23.9%. On this basis, the company's PEG ratio is 0.72. This suggests that its shares are undervalued. Additionally, the market is possibly undervaluing PDD in terms of its equity because its P/B ratio is 0.9 whereas the sector average is 3.18. The company's shares are currently trading 1076.3% below their Graham number.

PDD Has an Average Rating of Buy:

The 37 analysts following PDD have set target prices ranging from $119.85 to $277.21 per share, for an average of $206.69 with a buy rating. The company is trading -30.9% away from its average target price, indicating that there is an analyst consensus of strong upside potential.

PDD has an average amount of shares sold short because 3.8% of the company's shares are sold short. Institutions own 30.1% of the company's shares, and the insider ownership rate stands at 0.0%, suggesting a small amount of insider investors. The largest shareholder is Baillie Gifford and Company, whose 2% stake in the company is worth $4,966,624,090.

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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