PDD Holdings (PDD)
NASDAQ:PDD
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PDD Holdings
(NASDAQ:PDD)
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Rating:78Outperform
Price Target:
$116.00
▲(10.70% Upside)
Action:ReiteratedDate:04/15/26
The score is driven primarily by very strong financial performance (profitability, cash generation, and minimal leverage). Valuation is supportive with a low-to-moderate P/E, but the technical setup is only neutral-to-weak versus longer-term averages and the latest earnings call highlights near-term margin and cash-flow pressure from heavy investment and cost growth, plus added uncertainty in global expansion.
Positive Factors
High profitability and returns
Sustained high gross and net margins with elevated ROE indicate durable unit economics from platform scale and merchandising mix. These margins support recurring cash generation and provide flexibility to fund long‑term investments without immediate capital stress, underpinning competitive advantages.
Negative Factors
Rising costs pressuring margins
Material increases in cost of revenues and fulfillment expenses erode historical margin advantages and can persist as the company scales logistics and premium supply initiatives. Sustained higher COGS reduces free cash generation and constrains reinvestment capacity if unchecked.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability and returns
Sustained high gross and net margins with elevated ROE indicate durable unit economics from platform scale and merchandising mix. These margins support recurring cash generation and provide flexibility to fund long‑term investments without immediate capital stress, underpinning competitive advantages.
Read all positive factors
PDD Holdings (PDD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$135.97B
Dividend YieldN/A
Average Volume (3M)7.47M
Price to Earnings (P/E)11.5
Beta (1Y)0.90
Revenue Growth9.87%
EPS Growth-12.32%
CountryUS
Employees23,465
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)2.59
Shares Outstanding1,419,646,500
10 Day Avg. Volume6,783,133
30 Day Avg. Volume7,470,005
Financial Highlights & Ratios
PEG Ratio-0.77
Price to Book (P/B)2.67
Price to Sales (P/S)2.64
P/FCF Ratio10.36
Enterprise Value/Market Cap5.58
Enterprise Value/Revenue1.76
Enterprise Value/Gross Profit3.14
Enterprise Value/Ebitda7.28
Forecast
1Y Price Target
$137.98Price Target Upside31.67% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)81.85
Revenue Forecast (FY)$493.83B
PDD Holdings Business Overview & Revenue Model
Company Description
PDD Holdings Inc., a multinational commerce group, owns and operates a portfolio of businesses. It operates Pinduoduo, an e-commerce platform that offers products in various categories, including agricultural produce, apparel, shoes, bags, mother ...
How the Company Makes Money
PDD Holdings primarily makes money by monetizing traffic and transactions on its e-commerce platforms through a mix of online marketing services and transaction-related services.
1) Online marketing services (advertising/merchant marketing): Merc...
PDD Holdings Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes revenue from different business units or product lines, highlighting which areas drive growth and profitability, and where there might be opportunities or challenges.
Analyzes revenue from different business units or product lines, highlighting which areas drive growth and profitability, and where there might be opportunities or challenges.
Data provided by:
The Fly
The FlyPDD Holdings Earnings Call Summary
Earnings Call Date:Mar 25, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 22, 2026
Earnings Call Sentiment Neutral
The call presented a mix of constructive strategic progress and clear near-term execution and profit pressures. Positive elements include mid-to-high single-digit top-line growth (Q4 +12%, FY +10%), strong transaction-services growth (+19% Q4), a large cash balance (RMB 422.3B), and major strategic initiatives (RMB 100 billion support program and supply-chain transformation) that support long-term differentiation. Offsetting these are material increases in cost of revenues and operating expenses, softer operating cash flow, EPS declines, and heightened regulatory/geopolitical uncertainty for the global business. Management emphasizes a long-term investment horizon and expects short-term margin variability as it prioritizes supply-chain upgrades and ecosystem development.Positive Updates
Top-line Growth
Revenue of RMB 123.9 billion in Q4, up 12% year-over-year; full-year 2025 revenue RMB 431.8 billion, up 10% year-over-year.
Negative Updates
Rising Cost of Revenues and Operating Expenses
Total cost of revenues increased 15% in Q4 (RMB 55.2 billion vs RMB 47.8 billion) and rose 23% for the full year to RMB 188.8 billion, pressuring gross margins.
Read all updates
Q4-2025 Updates
Positive
Negative
Top-line Growth
Revenue of RMB 123.9 billion in Q4, up 12% year-over-year; full-year 2025 revenue RMB 431.8 billion, up 10% year-over-year.
Read all positive updates
Company Guidance
Management reiterated guidance to prioritize deep, long‑term investment in the supply chain (including the RMB 100 billion support program and prior RMB 10 billion fee reductions) and a 3‑year strategy to “build another Pinduoduo,” while continuing pilots such as free delivery to villages and last‑mile networks (country‑level transfer warehouses and village pickup points in over 10 provinces/municipalities) and expanding standardized production in hundreds of regions and operations in nearly 100 markets; financially the company reported Q4 revenue RMB 123.9 billion (+12% YoY) and FY2025 revenue RMB 431.8 billion (+10%), Q4 online marketing revenue RMB 60.0 billion (+5%) and transaction services RMB 63.9 billion (+19%), Q4 total cost of revenues RMB 55.2 billion (+15%) and FY cost of revenues RMB 188.8 billion (+23%), Q4 GAAP operating expenses RMB 41.0 billion (non‑GAAP RMB 39.3 billion; non‑GAAP Opex 32% of revenues) and FY non‑GAAP Opex RMB 140.7 billion, Q4 non‑GAAP S&M RMB 34.0 billion (27% of revenues; FY RMB 123.3 billion), Q4 non‑GAAP R&D RMB 4.4 billion (GAAP RMB 5.0 billion), Q4 GAAP operating profit RMB 27.7 billion (non‑GAAP RMB 29.5 billion; non‑GAAP margin 24% vs 25% a year ago) and FY non‑GAAP operating profit RMB 102.6 billion (vs RMB 18.3 billion in 2024), Q4 net income attributable RMB 24.5 billion and FY RMB 99.4 billion (Q4 basic EPS RMB 17.50, diluted RMB 16.51; non‑GAAP diluted EPS Q4 RMB 17.69), Q4 operating cash flow RMB 24.1 billion and FY operating cash flow RMB 106.9 billion, and year‑end cash, cash equivalents and short‑term investments of RMB 422.3 billion.PDD Holdings Financial Statement Overview
Summary
Income Statement
92
Very Positive
Balance Sheet
96
Very Positive
Cash Flow
89
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 420.08B | 393.84B | 247.64B | 130.56B | 93.95B |
| Gross Profit | 236.42B | 239.94B | 155.92B | 99.10B | 62.23B |
| EBITDA | 92.05B | 109.13B | 59.48B | 32.63B | 8.39B |
| Net Income | 96.66B | 112.43B | 60.03B | 31.54B | 7.77B |
Balance Sheet | |||||
| Total Assets | 630.45B | 505.03B | 348.08B | 237.12B | 181.21B |
| Cash, Cash Equivalents and Short-Term Investments | 496.46B | 331.56B | 217.21B | 149.44B | 92.94B |
| Total Debt | 5.38B | 10.61B | 10.17B | 16.93B | 12.76B |
| Total Liabilities | 215.27B | 191.72B | 160.84B | 119.35B | 106.10B |
| Stockholders Equity | 415.17B | 313.31B | 187.24B | 117.77B | 75.11B |
Cash Flow | |||||
| Free Cash Flow | 106.94B | 120.96B | 93.58B | 6.40B | 25.50B |
| Operating Cash Flow | 106.94B | 121.93B | 94.16B | 7.03B | 28.78B |
| Investing Cash Flow | -43.42B | -118.36B | -55.43B | -3.24B | -35.56B |
| Financing Cash Flow | -5.23B | 1.16M | -8.96B | 10.08M | -1.88B |
PDD Holdings Technical Analysis
Positive
104.79
Price Trends
102.13
Positive
107.01
Negative
115.24
Negative
Market Momentum
0.27
Negative
57.75
Neutral
60.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PDD, the sentiment is Positive. The current price of 104.79 is above the 20-day moving average (MA) of 100.76, above the 50-day MA of 102.13, and below the 200-day MA of 115.24, indicating a neutral trend. The MACD of 0.27 indicates Negative momentum. The RSI at 57.75 is Neutral, neither overbought nor oversold. The STOCH value of 60.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PDD.
PDD Holdings Risk Analysis
PDD Holdings disclosed 86 risk factors in its most recent earnings report. PDD Holdings 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
PDD Holdings Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $135.97B | 11.49 | 26.44% | ― | 9.87% | -12.32% | |
70 Outperform | $89.58B | 51.14 | 33.73% | ― | 39.06% | 4.50% | |
69 Neutral | $319.89B | 36.81 | 8.82% | 1.31% | 3.74% | -21.81% | |
64 Neutral | $41.12B | 14.55 | 8.57% | 3.37% | 13.13% | -51.27% | |
64 Neutral | $50.84B | 48.10 | 15.34% | ― | 36.38% | 245.29% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $37.13B | 206.19 | 4.52% | ― | 14.09% | 34.31% |
* Consumer Cyclical Sector Average
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PDD Holdings Corporate Events
PDD Holdings Balances 2025 Revenue Growth With Profit Decline Amid Heavy Investment Push
Mar 26, 2026
PDD Holdings reported unaudited results for the fourth quarter and full year ended December 31, 2025, on March 25, 2026, showing solid top-line growth but pressure on profitability. Fourth-quarter revenue rose 12% year on year to RMB123.9 billion,...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.