NasdaqGS:PDD

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Market Cap

US$152.4b

Last Updated

2021/06/24 03:13 UTC

Data Sources

Company Financials +

Executive Summary

Pinduoduo Inc., through its subsidiaries, operates an e-commerce platform in the People's Republic of China. More Details


Snowflake Analysis

Excellent balance sheet with high growth potential.


Similar Companies

Share Price & News

How has Pinduoduo's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PDD is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: PDD's weekly volatility (8%) has been stable over the past year.


Market Performance


7 Day Return

-1.0%

PDD

2.3%

US Online Retail

0.5%

US Market


1 Year Return

43.9%

PDD

21.1%

US Online Retail

42.6%

US Market

Return vs Industry: PDD exceeded the US Online Retail industry which returned 21.1% over the past year.

Return vs Market: PDD exceeded the US Market which returned 42.6% over the past year.


Shareholder returns

PDDIndustryMarket
7 Day-1.0%2.3%0.5%
30 Day-6.7%5.5%1.9%
90 Day-4.6%7.0%7.9%
1 Year43.9%43.9%21.2%21.1%44.9%42.6%
3 Yearn/a73.0%72.4%64.4%54.1%
5 Yearn/a288.5%288.0%128.3%102.7%

Long-Term Price Volatility Vs. Market

How volatile is Pinduoduo's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Pinduoduo undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PDD ($121.61) is trading below our estimate of fair value ($292.83)

Significantly Below Fair Value: PDD is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: PDD is unprofitable, so we can't compare its PE Ratio to the US Online Retail industry average.

PE vs Market: PDD is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate PDD's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: PDD is overvalued based on its PB Ratio (15.7x) compared to the US Online Retail industry average (4.7x).


Future Growth

How is Pinduoduo forecast to perform in the next 1 to 3 years based on estimates from 37 analysts?

61.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PDD is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (2%).

Earnings vs Market: PDD is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: PDD's is expected to become profitable in the next 3 years.

Revenue vs Market: PDD's revenue (25.4% per year) is forecast to grow faster than the US market (9.5% per year).

High Growth Revenue: PDD's revenue (25.4% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PDD's Return on Equity is forecast to be low in 3 years time (17.7%).


Past Performance

How has Pinduoduo performed over the past 5 years?

-24.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PDD is currently unprofitable.

Growing Profit Margin: PDD is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: PDD is unprofitable, and losses have increased over the past 5 years at a rate of 24.8% per year.

Accelerating Growth: Unable to compare PDD's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: PDD is unprofitable, making it difficult to compare its past year earnings growth to the Online Retail industry (117.1%).


Return on Equity

High ROE: PDD has a negative Return on Equity (-9.57%), as it is currently unprofitable.


Financial Health

How is Pinduoduo's financial position?


Financial Position Analysis

Short Term Liabilities: PDD's short term assets (CN¥139.6B) exceed its short term liabilities (CN¥79.1B).

Long Term Liabilities: PDD's short term assets (CN¥139.6B) exceed its long term liabilities (CN¥11.9B).


Debt to Equity History and Analysis

Debt Level: PDD's debt to equity ratio (19.5%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if PDD's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable PDD has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: PDD is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 41.9% per year.


Dividend

What is Pinduoduo current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate PDD's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate PDD's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if PDD's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if PDD's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of PDD's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

0.9yrs

Average management tenure


CEO

Lei Chen (40 yo)

0.92

Tenure

Mr. Lei Chen has been Chief Executive Officer of Pinduoduo Inc. since July 1, 2020. Mr. Chen has been a Director of Pinduoduo Inc. since 2020 and serves as its Chairman of the Board since March 17, 2021. H...


Leadership Team

Experienced Management: PDD's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Members

Experienced Board: PDD's board of directors are not considered experienced ( 2.9 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.6%.


Top Shareholders

Company Information

Pinduoduo Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Pinduoduo Inc.
  • Ticker: PDD
  • Exchange: NasdaqGS
  • Founded: 2015
  • Industry: Internet and Direct Marketing Retail
  • Sector: Retail
  • Market Cap: US$152.412b
  • Shares outstanding: 1.25b
  • Website: https://www.pinduoduo.com

Number of Employees


Location

  • Pinduoduo Inc.
  • No. 533 Loushanguan Road
  • 28th Floor
  • Shanghai
  • 200051
  • China

Listings


Biography

Pinduoduo Inc., through its subsidiaries, operates an e-commerce platform in the People's Republic of China. It operates Pinduoduo, a mobile platform that offers a range of products, including apparel, sho...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/06/24 03:13
End of Day Share Price2021/06/23 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.