PDD HOLDINGS INC (NASDAQ:PDD) - A Strong Growth Stock at a Reasonable Valuation

PDD HOLDINGS INC (NASDAQ:PDD) stands out as an attractive growth stock with a reasonable valuation, according to our Affordable Growth screener. The company combines strong growth metrics with solid profitability and financial health, making it a candidate for investors seeking growth at a reasonable price.

Growth Prospects

PDD has demonstrated impressive growth, with key highlights including:

• Revenue Growth: Over the past year, revenue increased by 35.67%, while the 5-year average growth stands at 67.20%.
• Earnings Expansion: EPS grew by 22.07% in the last year, with a 5-year average growth rate of 106.51%.
• Future Expectations: Analysts project continued growth, with EPS expected to rise by 8.78% annually and revenue by 11.05%.

Valuation

Despite its strong growth, PDD remains reasonably priced:

• P/E Ratio: At 10.11, it is well below the S&P 500 average of 27.45 and cheaper than 85.71% of its industry peers.
• Forward P/E: The forward P/E of 9.10 suggests continued undervaluation relative to both the market and sector.
• Enterprise Value/EBITDA: PDD trades at a discount compared to most competitors, reinforcing its appeal as a value play.

Profitability & Financial Health

The company also excels in profitability and financial stability:

• High Margins: A 24.63% profit margin and 24.47% operating margin place PDD at the top of its industry.
• Strong Returns: ROA of 18.69% and ROE of 30.08% highlight efficient capital use.
• Financial Strength: With no debt and a current ratio of 2.27, the company maintains excellent liquidity and solvency.

For a deeper look at PDD’s fundamentals, review the full analysis report.

Our Affordable Growth screener lists more stocks that fit this criteria and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should conduct your own research before making investment decisions.