Joyce Ju, an analyst from Bank of America Securities, maintained the Buy rating on JD. The associated price target remains the same with $37.00.
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Joyce Ju has given her Buy rating due to a combination of factors that highlight JD’s strong performance and future potential. JD’s second-quarter results exceeded expectations, with net revenues and non-GAAP net profit surpassing consensus estimates by 6% and 38%, respectively. This was primarily driven by accelerated growth in JD Retail, which saw a 21% year-over-year increase, benefiting from trade-in subsidies and promotional activities. Additionally, JD Retail’s operating margin expanded to 4.5%, supported by improved supply chain capabilities and higher-than-expected other incomes, despite significant food delivery losses.
Management has noted key milestones in the food delivery sector, which have started to generate synergies with JD’s core retail business. Although food delivery losses are projected to exceed RMB35 billion this year due to investments in system capabilities, the long-term value for the group remains promising. Consequently, Joyce Ju has raised revenue forecasts for 2025-2027 by 1-2% to reflect stronger JD Retail and incremental food delivery revenues. The Buy rating is maintained with a price objective of $37, based on solid JD Retail performance and favorable trading multiples.
In another report released today, DBS also maintained a Buy rating on the stock with a $42.00 price target.