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NASDAQ:PDD—A High-Growth Stock Gearing Up for Its Next Upward Move.

By Mill Chart

Last update: Jul 11, 2024

For growth-minded investors, high revenue and EPS growth are key criteria. Today, we'll examine whether PDD HOLDINGS INC (NASDAQ:PDD) fits the bill for growth investing, particularly as it forms a base and hints at a potential breakout. Remember, due diligence is essential, but PDD HOLDINGS INC has caught our attention on our screen for growth with base formation. It may warrant additional investigation.


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ChartMill's Evaluation of Growth

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:PDD has earned a 8 for growth:

  • The Earnings Per Share has grown by an impressive 91.34% over the past year.
  • PDD shows a strong growth in Revenue. In the last year, the Revenue has grown by 105.55%.
  • 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.
  • Based on estimates for the next years, PDD will show a very strong growth in Earnings Per Share. The EPS will grow by 30.86% on average per year.
  • Based on estimates for the next years, PDD will show a very strong growth in Revenue. The Revenue will grow by 26.32% on average per year.

Looking at the Health

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:PDD has earned a 9 out of 10:

  • PDD has an Altman-Z score of 7.63. This indicates that PDD is financially healthy and has little risk of bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 7.63, PDD belongs to the top of the industry, outperforming 90.91% of the companies in the same industry.
  • PDD has a debt to FCF ratio of 0.05. This is a very positive value and a sign of high solvency as it would only need 0.05 years to pay back of all of its debts.
  • The Debt to FCF ratio of PDD (0.05) is better than 93.94% of its industry peers.
  • PDD has a Debt/Equity ratio of 0.02. This is a healthy value indicating a solid balance between debt and equity.
  • PDD has a Debt to Equity ratio of 0.02. This is amongst the best in the industry. PDD outperforms 81.82% of its industry peers.
  • PDD has a Current Ratio of 2.09. This indicates that PDD is financially healthy and has no problem in meeting its short term obligations.
  • The Current ratio of PDD (2.09) is better than 75.76% of its industry peers.
  • A Quick Ratio of 2.09 indicates that PDD has no problem at all paying its short term obligations.
  • The Quick ratio of PDD (2.09) is better than 84.85% of its industry peers.

Assessing Profitability for 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:

  • Looking at the Return On Assets, with a value of 21.15%, PDD belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
  • PDD has a Return On Equity of 36.54%. This is amongst the best in the industry. PDD outperforms 93.94% of its industry peers.
  • With an excellent Return On Invested Capital value of 29.27%, PDD belongs to the best of the industry, outperforming 100.00% 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 11.29%.
  • The last Return On Invested Capital (29.27%) for PDD is above the 3 year average (17.97%), which is a sign of increasing profitability.
  • PDD has a Profit Margin of 26.93%. This is amongst the best in the industry. PDD outperforms 100.00% of its industry peers.
  • Looking at the Operating Margin, with a value of 26.19%, PDD belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
  • The Gross Margin of PDD (61.83%) is better than 84.85% of its industry peers.

How do we evaluate the setup for NASDAQ:PDD?

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for NASDAQ:PDD is 7:

PDD has only a medium technical rating, but it does show a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 140.70. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 135.40, a Stop Loss order could be placed below this zone.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

Our latest full fundamental report of PDD contains the most current fundamental analsysis.

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

Keep in mind

This article should in no way be interpreted as advice. 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 (7/10/2024, 7:20:28 PM)

Premarket: 140.01 +1.94 (+1.41%)

138.07

+0.35 (+0.25%)

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