On Thursday, JPMorgan made an adjustment to the shares price target for Pinduoduo Inc. (NASDAQ:PDD), a leading Chinese e-commerce platform. The firm lowered its price target to $190 from $195 while sustaining an Overweight rating.
The adjustment followed Pinduoduo's fourth-quarter earnings report, which showed a significant performance with the company's share price increasing by 3.5% overnight. This rise was modest compared to the 16% spike seen at market opening and also lagged behind the 2% increase of the broader KraneShares CSI China Internet ETF (KWEB).
The analyst from JPMorgan attributed the restrained share price movement to profit-taking by short-term investors and a hesitation from long-term investors due to limited information provided by the company on the earnings beat and future outlook. Despite this, the firm remains confident in Pinduoduo's earnings potential, suggesting that the strong results could lead to an earnings revision upward story in the next three to six months.
JPMorgan's analysis indicates that Pinduoduo's adjusted earnings per share (EPS) estimates for 2024 and 2025 are 14% and 9% above the Bloomberg consensus, respectively. This translates to a 14x price-to-earnings ratio for 2024, with expected EPS growth rates of 48% and 27% for 2024 and 2025.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.