On Friday, Citi analyst Alicia Yap maintained a Buy rating on JD.com, Inc. (NASDAQ:JD), with a steady price target of $51.00, representing significant upside from the current price of $34.92. The $49.62 billion market cap company, which InvestingPro analysis shows is currently undervalued, received this endorsement following its initiative to lead the continuation of national trade-in programs into 2025.
This effort is in partnership with key provinces such as Hubei, Jiangsu, and Hunan. JD.com's platform is extensive, covering over 200 qualified sub-categories and receiving participation from over 90% of counties and rural areas.
JD.com's strategy leverages its first-party (1P) supply chain and an omni-channel approach that combines online services with physical outlets, including JD Mall and JD appliance flagship stores. This approach provides the company with the broadest national coverage and positions it as a preferred partner for many provincial and local governments.
With annual revenues of $159.3 billion and a strong financial health score rated as "GOOD" by InvestingPro, which offers 12 additional key insights about JD.com's financial position, the company maintains a solid foundation for growth.
The strength of JD.com's platform and its strategic positioning in the trade-in program may have been undervalued by the market, according to Yap. The analyst anticipates that JD.com's proactive role in the trade-in initiative will likely fuel stronger-than-expected Gross Merchandise Value (GMV) and revenue growth in the first half of 2025, with potential upside risks to consensus estimates.
Yap's analysis suggests that the early mover advantage in the trade-in program could be a significant catalyst for JD.com. The firm has opened a 90-day upside catalyst watch, signaling confidence in JD.com's potential for positive performance in the near term.
In other recent news, JD.com reported a 5% year-on-year increase in third-quarter earnings, reaching RMB 260 billion in net revenues. The company's general merchandise grew by 8%, with a significant turnaround in electronics and home appliances.
Bernstein SocGen Group upgraded JD.com from Market Perform to Outperform and increased the price target to $46.00, emphasizing the company's improved Gross Merchandise Volume growth efficiency. Additionally, JD.com plans to acquire full ownership of Kuayue-Express Group Co., LTD., aiming to enhance its logistics market position and service offerings.
JD.com also received a Buy rating from Huatai Financial, highlighting its strong market position in high-unit-price consumer discretionary goods, such as home appliances. The firm anticipates JD.com will use its incremental profits to reward consumers and expand the supply of non-electronic categories, diversifying its product offerings.
In the e-commerce landscape, Xiaohongshu Technology Co.'s Instagram-style app Xiaohongshu is projected to double its profits to surpass $1 billion in 2024, potentially leading to an initial public offering. Meanwhile, US-listed Chinese stocks experienced a downturn in premarket trading as investors opted to secure profits following a significant rally.
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