JD.com (NasdaqGS:JD) Valuation in Focus After Q3 Earnings and Major Share Buyback

JD.com (NasdaqGS:JD) just announced its third quarter earnings, highlighting a climb in revenue alongside a drop in net income compared to last year. The company also wrapped up a significant share repurchase, which reduced its total shares outstanding.

See our latest analysis for JD.com.

JD.com's latest earnings and major share repurchase have been front and center for investors, but the stock has struggled to build momentum this year. After the completion of its significant buyback, the latest 30-day share price return stands at -14.47%, and the total shareholder return over the past year is -15.55%. These moves suggest market sentiment is still cautious despite management’s attempts to add value. Long-term shareholders have seen steeper declines, but some observers see potential for a turnaround as recent initiatives take root.

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With shares still down over the past year and trading at more than a 50% discount to average analyst price targets, investors are left to consider if JD.com is genuinely undervalued or if the market is rightly anticipating further hurdles ahead.

Most Popular Narrative: 36.2% Undervalued

Compared to JD.com's last close at $28.88, the most popular narrative estimates the fair value at $45.26. This sizable difference suggests analysts see meaningful upside, setting the stage for a closer look at what is fueling their call.

"Ongoing investments in logistics, automation, and supply chain optimization (including adoption of AI and unmanned logistics) continue to reduce procurement costs, improve fulfillment efficiencies, and expand margins in the core retail segment, supporting further gross margin and operating margin expansion over the long term."

Read the complete narrative.

Want to unlock the math behind that big upside? The narrative’s fair value relies on ambitious revenue growth, steady margins, and a future profit multiple. What numbers are bold enough to justify such a high target? See for yourself; this narrative puts it all on the line.

Result: Fair Value of $45.26 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition in food delivery and widening losses from new market expansions could threaten JD.com's growth outlook if these risks are not contained.

Find out about the key risks to this JD.com narrative.

Build Your Own JD.com Narrative

If you see things differently or want to dig into the data on your own terms, you can easily build and share your own perspective in just minutes, Do it your way

A great starting point for your JD.com research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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