Update shared on 11 Nov 2025
Fair value Increased 0.45%The analyst price target for PDD Holdings increased modestly by $0.65 to $145.77 per share. Analysts cited balanced growth initiatives and sustained profitability following stronger-than-expected second quarter results.
Analyst Commentary
Analyst sentiment on PDD Holdings features notable split perspectives following the second quarter report. While several bullish analysts increased their price targets on valuation strength and growth prospects, others have highlighted risks stemming from domestic competition, unpredictable profitability, and overseas market regulation. Below are key takeaways summarizing both views.
Bullish Takeaways- Bullish analysts have raised price targets considerably, citing stronger-than-expected profitability and the company’s ability to control spending amid a competitive e-commerce landscape.
- PDD’s disciplined balance between growth initiatives and cost efficiency has enabled enhanced earnings forecasts and improved confidence in future performance.
- The ongoing domestic merchant support program and significant investment into global operations are seen as supportive for long-term market expansion and customer trust.
- Some analysts believe the company’s recent results mark an inflection point, highlighting cost flexibility and resilience against market turbulence.
- Bearish analysts are cautious about fluctuations in profitability, warning that recent margin strength may not be sustained in upcoming quarters as investment in merchant and ecosystem support continues.
- There are concerns that the merchant support program, while strategic for long-term growth, has negatively impacted revenue growth rates and gross margins.
- Limited upside to estimates is expected in the near term due to competitive pressures at home and regulatory uncertainties in international markets.
- Some have downgraded their outlook based on expectations that PDD is willing to accept lower near-term profits to fuel platform reinvestment, contributing to increased earnings volatility ahead.
What's in the News
- Temu, operated by PDD Holdings, has resumed shipments from China to the U.S. and increased ad spending after pausing some services in May. Fully managed logistics were restored in July (The Financial Times).
- Citi increased its price target for PDD Holdings from $154 to $168 and maintained a Buy rating. However, the firm cautions that recent profits were boosted by e-commerce seasonality and may not reflect future trends (Citi).
- Macquarie raised PDD Holdings’ price target from $126 to $165, citing Q2 results that outperformed expectations despite domestic and geopolitical challenges. The firm notes management’s warnings about unsustained profitability and highlights improved cost flexibility (Macquarie).
- Jefferies lifted its price target for PDD Holdings to $146 from $121 and reiterated a Buy rating. The firm attributes its optimism to earnings beats and the company’s merchant support program, which is aimed at fueling global expansion (Jefferies).
Valuation Changes
- Fair Value Estimate: Increased slightly from $145.12 to $145.77 per share.
- Discount Rate: Went up from 8.71% to 8.99%.
- Revenue Growth Estimate: Rose from 10.76% to 10.89%.
- Net Profit Margin: Declined modestly from 26.50% to 26.41%.
- Future P/E Ratio: Increased from 12.85x to 13.02x.
Disclaimer
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