Dingdong (DDL) AI Stock Analysis

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Dingdong

(NYSE:DDL)

64Neutral

Dingdong's overall stock score reflects its significant financial recovery and improved profitability, positioning it well for future growth. However, the technical indicators suggest current market caution, and the high debt levels warrant careful management. The stock is fairly valued, making it a balanced investment with potential for future appreciation.

Dingdong (DDL) vs. S&P 500 (SPY)

Market Cap

$550.60M

Dividend YieldN/A

Average Volume (3M)925.84K

Price to Earnings (P/E)13.7

Beta (1Y)1.05

Revenue Growth13.67%

EPS GrowthN/A

CountryUS

Employees3,120

SectorConsumer Cyclical

Sector Strength64

IndustryGrocery Stores

Share Statistics

EPS (TTM)0.18

Shares Outstanding180,623,400

10 Day Avg. Volume1,276,215

30 Day Avg. Volume925,836

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.19

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Dingdong Business Overview & Revenue Model

Company DescriptionDingdong (Cayman) Limited, commonly known as Dingdong (DDL), is a prominent player in China's fresh grocery e-commerce sector. The company specializes in the delivery of fresh produce, including fruits, vegetables, meat, seafood, and other daily essentials. Dingdong operates primarily through its mobile application and website, offering consumers the convenience of online shopping combined with efficient, same-day delivery services. The company emphasizes the quality and freshness of its products, ensuring a seamless shopping experience for its users.

How the Company Makes MoneyDingdong (DDL) generates revenue primarily through the sale of fresh groceries and daily essentials via its e-commerce platform. Customers place orders through the Dingdong app or website, and the company fulfills these orders through its network of distribution centers and delivery personnel. The key revenue streams include the direct sale of food items and household goods, service fees associated with delivery, and potentially membership fees for premium services. Additionally, Dingdong may engage in partnerships with local farms and suppliers to secure favorable pricing and ensure a steady supply of quality products, which can enhance its profit margins. The company's earnings are significantly influenced by its operational efficiency, user base growth, and the ability to maintain competitive pricing in a rapidly evolving market.

Dingdong Financial Statement Overview

Summary

Dingdong has demonstrated significant improvements in profitability and cash flow, marking a turnaround from previous losses. Despite a high debt load, the company shows strong returns on equity. The cash flow position is robust, supporting future growth. However, the high leverage and relatively low equity buffer pose potential risks in a volatile market.

Income Statement

Positive

Dingdong shows a positive turnaround with a TTM net profit margin of 0.90%, a significant improvement from previous losses. Revenue growth is positive at 10.92% TTM, with gross profit margin solid at 30.17%. EBIT and EBITDA margins have improved to 0.59% and 1.29% TTM, respectively, indicating better operational efficiency. However, past volatility in profitability remains a concern.

Balance Sheet

Positive

The company has a high debt-to-equity ratio of 4.68 TTM, suggesting significant leverage. However, the return on equity is strong at 31.73% TTM, indicating efficient use of equity. The equity ratio of 9.14% reflects low equity compared to assets, which poses a financial risk.

Cash Flow

Positive

Dingdong's cash flow has improved, with a strong free cash flow growth rate of 343.63% TTM. The operating cash flow to net income ratio is favorable at 4.31 TTM, indicating robust cash generation. The free cash flow to net income ratio is also strong at 3.89 TTM, highlighting effective cash management.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
22.15B	19.97B	24.22B	20.12B	11.34B	3.88B
	Gross Profit
6.69B	6.12B	7.49B	4.04B	2.23B	664.94M
	EBIT
131.15M	-130.12M	-708.85M	-6.33B	-3.16B	-1.74B
	EBITDA
285.12M	182.10M	-528.46M	-6.12B	-3.02B	-1.78B
	Net Income Common Stockholders
199.28M	-99.88M	-806.88M	-6.43B	-3.21B	-1.93B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.51B	5.31B	6.49B	5.23B	2.38B	1.18B
	Total Assets
6.75B	7.70B	9.38B	9.42B	4.92B	2.11B
	Total Debt
3.55B	4.52B	5.61B	5.39B	2.85B	1.09B
	Net Debt
2.42B	3.31B	3.75B	4.73B	1.47B	153.05M
	Total Liabilities
6.21B	7.20B	8.96B	8.66B	5.67B	2.82B
	Stockholders Equity
422.10M	382.53M	310.18M	728.07M	-744.67M	-705.78M
Cash Flow		Free Cash Flow
774.66M	-317.93M	-19.75M	-6.12B	-2.30B	-1.09B
	Operating Cash Flow
857.99M	-234.61M	107.14M	-5.67B	-2.06B	-964.27M
	Investing Cash Flow
821.11M	519.33M	-66.90M	-4.07B	-1.02B	-185.63M
	Financing Cash Flow
-2.07B	-934.42M	1.11B	9.04B	3.66B	1.68B

Dingdong Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price2.58

Price Trends

50DMA

2.89

Negative

100DMA

3.28

Negative

200DMA

3.07

Negative

Market Momentum

MACD

-0.11

Negative

RSI

49.35

Neutral

STOCH

81.28

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DDL, the sentiment is Neutral. The current price of 2.58 is above the 20-day moving average (MA) of 2.40, below the 50-day MA of 2.89, and below the 200-day MA of 3.07, indicating a neutral trend. The MACD of -0.11 indicates Negative momentum. The RSI at 49.35 is Neutral, neither overbought nor oversold. The STOCH value of 81.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DDL.

Dingdong Risk Analysis

Dingdong disclosed 79 risk factors in its most recent earnings report. Dingdong reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Dingdong Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WMK	77 Outperform	$2.19B	20.56	7.80%	1.62%	2.00%	5.89%
VLGEA	74 Outperform	$470.70M	9.53	11.59%	2.81%	3.96%	3.39%
NGVC	72 Outperform	$1.11B	31.01	21.52%	0.91%	9.31%	35.37%
IMKTA	65 Neutral	$1.14B	15.20	5.15%	1.05%	-7.38%	-57.42%
GO	65 Neutral	$1.54B	39.50	3.27%	―	10.13%	-50.29%
DDL	64 Neutral	$550.60M	13.73	50.24%	―	13.67%	―
Sector *	60 Neutral	$6.85B	11.57	3.09%	4.18%	2.37%	-21.38%

* Consumer Cyclical Sector Average

Performance Comparison

DDL

Dingdong

2.54

1.28

101.59%

IMKTA

Ingles Markets

61.12

-10.85

-15.08%

VLGEA

Village Super Market

35.39

8.86

33.40%

WMK

Weis Markets

81.45

18.99

30.40%

NGVC

Natural Grocers

48.58

31.93

191.77%

Grocery Outlet Holding

15.69

-10.48

-40.05%

Dingdong Earnings Call Summary

Earnings Call Date: Mar 6, 2025 | % Change Since: -17.83% | Next Earnings Date: Jun 11, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance, with significant revenue and profit growth, expansion in user base, and strategic geographical market penetration. Although there were minor challenges in profit margins and certain regional markets, the overall sentiment was positive given the consistent profitability and strategic growth initiatives.

Highlights

Consistent Profitability Achieved

Dingdong achieved non-GAAP profitability for the eighth consecutive quarter and GAAP profitability for the third consecutive quarter.

Revenue and GMV Growth

Revenue increased by 27.2% year-over-year to CNY 6.54 billion and GMV grew by 28.3% to CNY 7.27 billion.

User Base Expansion

Average number of active transacting users rose to approximately 8.22 million, a 24.5% year-over-year increase.

Geographical Growth in Key Markets

Shanghai's GMV increased by 24.5% year-over-year, while Jiangsu and Zhejiang saw approximately 40% growth each.

Improved Cash Flow and Financial Position

Operating net cash inflow in Q3 reached CNY 400 million, marking the fifth consecutive quarter of net cash inflow from operating activities.

Strong Performance in Lower-Tier Cities

Excluding top cities, other cities across Jiangsu and Zhejiang regions increased GMV by over 40% year-over-year.

Expansion of Product Categories

Introduced an array of new products, contributing to the frequency of purchases and number of items per order.

Lowlights

Decreased Gross Profit Margin

Gross profit margin decreased by 0.6 percentage points year-over-year due to strategic decisions to pass supply chain benefits to consumers.

Challenges in Beijing and Guangzhou-Shenzhen Regions

Despite improvements, the GMV growth in Beijing and Guangzhou-Shenzhen regions were relatively modest at 14.6% and 2.9%, respectively.

Company Guidance

During Dingdong Limited's Q3 2024 earnings call, management provided robust guidance highlighting significant growth across key financial metrics. The company reported a 28.3% year-over-year increase in GMV, reaching CNY 7.27 billion, while revenue rose by 27.2% to CNY 6.54 billion. Non-GAAP net profit surged over ninefold to CNY 160 million, with a profit margin of 2.5%, and GAAP net profit soared 62-fold to CNY 133 million, achieving a 2% margin. The average number of active transacting users climbed by 24.5% to approximately 8.22 million, with user stickiness mirrored in a 6.1% rise in average orders per month. The company also expanded its frontline fulfillment stations, enhancing geographical penetration in key regions like Jiangsu, Zhejiang, and Shanghai, which saw GMV growth of up to 40%. Improvements in the supply chain and operational efficiencies contributed to a gross profit margin of 29.8% and a fulfillment expense rate reduction to 21.4%. Looking ahead, Dingdong remains optimistic about continuing its trajectory of sustainable growth, raising targets for new fulfillment station openings and expecting further profitability increments in Q4 and the full year of 2024.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.