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In a market where value is scarce, NASDAQ:PDD offers a refreshing opportunity with its solid fundamentals.

By Mill Chart

Last update: Apr 17, 2024

Our stock screening tool has identified PDD HOLDINGS INC (NASDAQ:PDD) as an undervalued gem with strong fundamentals. NASDAQ:PDD boasts decent financial health and profitability while maintaining an attractive price point. We'll break it down further.

Valuation Assessment of NASDAQ:PDD

ChartMill provides a Valuation Rating to every stock, ranging from 0 to 10. This rating assesses various valuation aspects, comparing price to earnings and cash flows, while considering factors like profitability and growth. NASDAQ:PDD boasts a 7 out of 10:

  • 69.70% of the companies in the same industry are more expensive than PDD, based on the Price/Earnings ratio.
  • The average S&P500 Price/Earnings ratio is at 24.93. PDD is valued slightly cheaper when compared to this.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of PDD indicates a somewhat cheap valuation: PDD is cheaper than 66.67% of the companies listed in the same industry.
  • PDD's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.41.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of PDD indicates a rather cheap valuation: PDD is cheaper than 81.82% of the companies listed in the same industry.
  • PDD's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • The excellent profitability rating of PDD may justify a higher PE ratio.
  • A more expensive valuation may be justified as PDD's earnings are expected to grow with 30.98% in the coming years.

Evaluating Profitability: NASDAQ:PDD

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:PDD scores a 8 out of 10:

  • PDD's Return On Assets of 17.25% is amongst the best of the industry. PDD outperforms 96.97% of its industry peers.
  • Looking at the Return On Equity, with a value of 32.06%, PDD belongs to the top of the industry, outperforming 87.88% of the companies in the same industry.
  • With an excellent Return On Invested Capital value of 25.64%, PDD belongs to the best of the industry, outperforming 96.97% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years for PDD is significantly above the industry average of 11.22%.
  • The last Return On Invested Capital (25.64%) for PDD is above the 3 year average (17.97%), which is a sign of increasing profitability.
  • PDD has a Profit Margin of 24.24%. This is amongst the best in the industry. PDD outperforms 96.97% of its industry peers.
  • PDD has a Operating Margin of 23.70%. This is amongst the best in the industry. PDD outperforms 100.00% of its industry peers.
  • With an excellent Gross Margin value of 62.96%, PDD belongs to the best of the industry, outperforming 84.85% of the companies in the same industry.

Evaluating Health: NASDAQ:PDD

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:PDD, the assigned 7 for health provides valuable insights:

  • An Altman-Z score of 6.13 indicates that PDD is not in any danger for bankruptcy at the moment.
  • PDD has a Altman-Z score of 6.13. This is amongst the best in the industry. PDD outperforms 87.88% of its industry peers.
  • PDD has a debt to FCF ratio of 0.06. This is a very positive value and a sign of high solvency as it would only need 0.06 years to pay back of all of its debts.
  • With an excellent Debt to FCF ratio value of 0.06, PDD belongs to the best of the industry, outperforming 93.94% of the companies in the same industry.
  • A Debt/Equity ratio of 0.03 indicates that PDD is not too dependend on debt financing.
  • PDD has a Debt to Equity ratio of 0.03. This is in the better half of the industry: PDD outperforms 78.79% of its industry peers.
  • Looking at the Current ratio, with a value of 1.93, PDD is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
  • PDD has a better Quick ratio (1.93) than 78.79% of its industry peers.

Assessing Growth Metrics for NASDAQ:PDD

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:PDD has received a 8 out of 10:

  • PDD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 68.74%, which is quite impressive.
  • The Revenue has grown by 89.68% in the past year. This is a very strong growth!
  • Measured over the past years, PDD shows a very strong growth in Revenue. The Revenue has been growing by 79.96% on average per year.
  • PDD is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 30.98% yearly.
  • PDD is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 24.65% yearly.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

Check the latest full fundamental report of PDD for a complete fundamental analysis.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.

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PDD HOLDINGS INC

NASDAQ:PDD (5/30/2024, 8:38:09 AM)

151.585

+0.31 (+0.21%)

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