Is It Too Late to Buy Pinduoduo (PDD) Stock?

Motley Fool2023-05-30

Pinduoduo's (PDD -5.40%) stock surged 19% on May 26 after the Chinese e-commerce company posted its first-quarter report. Its revenue rose 58% year over year to 37.64 billion yuan ($5.48 billion), ...

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Its revenue rose 58% year over year to 37.64 billion yuan ($5.48 billion), ...</p>\n\n<a href=\"https://www.fool.com/investing/2023/05/30/is-it-too-late-to-buy-pinduoduo-pdd-stock/\">Source Link</a>\n\n</div>\n","source":"fool_stock","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Is It Too Late to Buy Pinduoduo (PDD) Stock?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nIs It Too Late to Buy Pinduoduo (PDD) Stock?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-05-30 11:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.fool.com/investing/2023/05/30/is-it-too-late-to-buy-pinduoduo-pdd-stock/><strong>Motley Fool</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Pinduoduo's (PDD -5.40%) stock surged 19% on May 26 after the Chinese e-commerce company posted its first-quarter report. Its revenue rose 58% year over year to 37.64 billion yuan ($5.48 billion), ...</p>\n\n<a href=\"https://www.fool.com/investing/2023/05/30/is-it-too-late-to-buy-pinduoduo-pdd-stock/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4588","symbol_name":"碎股","start_time":0,"source_url":"https://www.fool.com/investing/2023/05/30/is-it-too-late-to-buy-pinduoduo-pdd-stock/","article_id":"2339285726","we_media_id":null,"thumbnails":["https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F734218%2Flaptop-shopping-cart.jpg&op=resize&w=165&h=104"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2339285726","pubTimestamp":1685415600,"sourceInfo":{"source_id":"fool_stock","name":"Motley Fool"},"weMediaInfo":null,"summary":"This high-growth Chinese e-commerce leader still has room to run.","collect":0,"end_time":0,"defaultTopTitle":"fool.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4588":"碎股","BK4579":"人工智能","LU1880383366.USD":"东方汇理中国股票基金 A2 (C)","LU0106959298.USD":"UBS (LUX) EQUITY FUND - EMERGING MARKETS SUSTAINABLE LEADERS (USD) \"P\" (USD) ACC","LU0516422440.USD":"FULLERTON LUX FUNDS - ASIA FOCUS EQUITIES \"A\" (USD) ACC","BK4122":"互联网与直销零售","LU0821914370.USD":"贝莱德亚洲成长领袖A2","LU0516422366.SGD":"Fullerton Lux Funds - Asia Focus Equities A Acc SGD","LU1046422090.SGD":"Fidelity Pacific A-SGD","BK4551":"寇图资本持仓","BK4502":"阿里概念","LU0251143458.SGD":"Fidelity Emerging Markets A-SGD","LU0048580855.USD":"富达大中华区A","BK4505":"高瓴资本持仓","BK4581":"高盛持仓","BK4504":"桥水持仓","IE00B0JY6N72.USD":"PINEBRIDGE GLOBAL EMERGING MARKETS FOCUS EQUITY \"A\" (USD) ACC","BK4548":"巴美列捷福持仓","LU1242518857.USD":"FULLERTON LUX FUNDS - ASIA ABSOLUTE ALPHA \"I\" (USD) ACC","BK4565":"NFT概念","IE0008368742.USD":"首域中国增长基金I Acc","LU0307460666.USD":"EASTSPRING INVESTMENTS CHINA EQUITY \"A\" ACC","SG9999002463.SGD":"LionGlobal China Growth SGD","LU0456827905.SGD":"JPMorgan Funds - China A (acc) SGD","LU1051768304.USD":"贝莱德新兴市场股票收益A6","BK4554":"元宇宙及AR概念","LU0516423091.SGD":"FULLERTON LUX FUNDS - ASIA FOCUS EQUITIES \"I\" (SGD) ACC","LU1048596156.SGD":"Blackrock Asian Growth Leaders A2 SGD-H","BK4531":"中概回港概念","BK4553":"喜马拉雅资本持仓","LU2264538146.SGD":"Fullerton Lux Funds - Global Absolute Alpha A Acc SGD","BK4534":"瑞士信贷持仓","BK4585":"ETF&股票定投概念","LU1515016050.SGD":"Blackrock Emerging Markets Equity Income A6 SGD-H","BK4533":"AQR资本管理(全球第二大对冲基金)","LU0051755006.USD":"摩根大通中国A (dist)","BK4538":"云计算","09618":"京东集团-SW","LU0370786039.SGD":"Fidelity Greater China A-SGD","LU1688375341.USD":"贝莱德中国灵活股票基金","LU2039709279.SGD":"MANULIFE GF DRAGON GROWTH \"AA\" (SGDHDG) INC","BK4575":"芯片概念","BK4509":"腾讯概念","LU0516423174.USD":"FULLERTON LUX FUNDS - ASIA FOCUS EQUITIES \"I\" (USD) ACC","BK4558":"双十一","BK4587":"ChatGPT概念","BK4535":"淡马锡持仓","BK4524":"宅经济概念","JD":"京东","BK4501":"段永平概念"},"translate_title":"现在买拼多多（PDD）的股票还来得及吗？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"JD":1,"09618":0.6},"content_text":"Pinduoduo's (PDD -5.40%) stock surged 19% on May 26 after the Chinese e-commerce company posted its first-quarter report. Its revenue rose 58% year over year to 37.64 billion yuan ($5.48 billion), beating analysts' estimates by $920 million. Its adjusted net income grew 141% to 10.13 billion yuan ($1.47 billion), or $1.01 per American depositary share (ADS), which also cleared the consensus forecast by $0.38.Pinduoduo is still clearly growing much faster than its two closest e-commerce competitors, Alibaba (NYSE: BABA) and JD.com (NASDAQ: JD). But is it too late to buy this stock following its 42% rally over the past 12 months?Image source: Getty Images.Why is Pinduoduo growing so rapidly?Pinduoduo was founded in 2015, and it quickly gained ground against Alibaba and JD by selling discount products across China's lower-tier cities. It also encouraged its shoppers to team up through social media platforms to score bulk discounts.Pinduoduo capitalized on that initial growth spurt to expand into the fresh produce market. But unlike Alibaba and JD, which operated their own brick-and-mortar supermarkets, Pinduoduo directly connected farmers to consumers through its own logistics network. That forward-thinking approach turned it into China's largest online agricultural platform.After firmly establishing its position as China's third-largest e-commerce player (in terms of annual revenues) after Alibaba and JD, Pinduoduo expanded across China's more affluent cities by selling higher-end brand-name products. It also challenged Alibaba's AliExpress and ContextLogic's Wish with Temu, a cross-border discount marketplace that connects its Chinese sellers to overseas buyers.When Pinduoduo went public in 2018, the critics dismissed it as another unprofitable Chinese e-commerce underdog to be rendered obsolete by Alibaba and JD. But here's what actually happened over the past four years.      Period2019202020212022Q1 2023Revenue$4.33B$9.12B$14.74B$18.93B$5.48BOperating margin(28.4%)(15.8%)7.3%23.3%18.4%Net income($1.00B)($1.10B)$1.22B$4.57B$1.18BData source: Pinduoduo. GAAP USD terms.Pinduoduo's revenues soared as its discount and agricultural marketplaces gained hundreds of millions of shoppers. And its margins expanded as economies of scale kicked in and it phased out its lower-margin first-party marketplace in the second half of 2021. It also likely benefited from China's antitrust crackdown on Alibaba, which forced the market leader to end its exclusive deals with merchants and rein in its aggressive loss-leading promotions.What's next for Pinduoduo?During the conference call, Pinduoduo's new co-CEO, Jiazhen Zhao, said the company was seeing \"clear recovery trends\" in China's post-COVID-19 market but admitted that it \"stepped up discounts and issued extra coupons\" throughout the Chinese New Year to capitalize on that rebound and fend off \"intense industry competition.\"That's why Pinduoduo's operating margin declined by 450 basis points sequentially (but still more than doubled year over year) to 18.4% in the first quarter. It expects that pressure to persist throughout the year as it ramps up its promotions and expands its platform with a new 10 billion yuan ($1.4 billion) \"ecosystem initiative\" Zhao claims will \"channel more resources toward high-quality sellers\" and improve its overall \"service efficiency and quality.\"Pinduoduo also plans to gradually expand Temu, which VP of Finance Jun Liu said was still in an \"early stage\" of development and only contributing a \"small\" amount to its top-line growth. That expansion could diversify its business away from China and enable it to compete directly against AliExpress, Wish, and Amazon in the cross-border market.Pinduoduo didn't provide any guidance for the full year, but analysts expect its revenue to rise 30%, its operating margin to decline slightly, and its net income to grow by 6%. By comparison, analysts expect Alibaba and JD to grow their revenues by 9% and 5%, respectively, in their current fiscal years.Is it too late to buy Pinduoduo's stock?Pinduoduo trades at 19 times forward earnings, while Alibaba and JD have forward multiples of 13 and 15, respectively. Pinduoduo might look a bit pricier than its slower-growth rivals, but it's still cheap relative to its near-term growth.That's probably because investors are still reluctant to dive back into Chinese stocks while they still face delisting threats in the United States. Temu's overseas expansion could also still be derailed by cybersecurity probes, outright bans (which just happened in Montana), and other escalating tensions between the United States and China.But if you believe those tensions will eventually ease, it could be a great time to invest in Pinduoduo since it should remain the fastest-growing Chinese e-commerce leader for the foreseeable future. Its margins are healthy, its valuations are cheap, and it has plenty of room to expand its domestic and overseas businesses.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2339285726"}