Chinese e-commerce giant JD.com (JD) is scheduled to announce its second-quarter results on Thursday, August 14. JD stock declined over 7% year-to-date due to rising competition, operational difficulties, and an uncertain macro environment. Wall Street analysts expect JD.com to report EPS (earnings per share) of $0.97, reflecting a 60% decline from the prior-year quarter.
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Meanwhile, revenues are expected to rise by 16% from the same quarter last year, reaching $46.6 billion, according to data from the TipRanks Forecast page. Investors will look forward to management’s commentary on tariffs, JD.com’s aggressive growth in food delivery, and AI (artificial intelligence)-related tailwinds.
Analyst’s Take Ahead of Q2 Earnings
Ahead of the Q2 print, Citi analyst Alicia Yap renewed her Buy rating on JD.com stock with a $42 price target, following a period of rating suspension. The price target implies a 34.7% upside potential from the current levels.
The analyst expects JD.com to post strong Q2 results, driven by growth in its main retail units. She sees revenue rising 15.3% year-over-year to RMB 336 billion. Electronics sales are set to grow 16.6% to RMB 169 billion, while general goods sales may rise 15% to RMB 102.2 billion. However, non-GAAP net profit is expected to drop 68% to RMB 4.68 billion.
For the third quarter, Citi projects revenue growth of 10.7% year-over-year to RMB 288.1 billion and non-GAAP net profit of RMB 4.58 billion.
Options Traders Anticipate a Minor Move
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry; the Options tool does this for you.
Indeed, it currently says that options traders are expecting a 5.98% move in either direction.
Is JD Stock a Buy or Sell?
Wall Street has a Moderate Buy consensus rating on JD.com stock based on 12 Buys, two Holds, and one Sell rating. The average JD stock price target of $42.13 implies 31.16% upside potential.
