US stock futures edge lower after S&P 500 hits record high; PCE data in focus
Investing.com - HSBC raised its price target on Pinduoduo Inc. (NASDAQ:PDD) to $155.00 from $122.00 on Tuesday, while maintaining a Buy rating following the company’s better-than-expected second-quarter earnings. The company, currently trading at $128.21, has demonstrated impressive financial health with a 19.92% revenue growth over the last twelve months and maintains strong gross profit margins of 57.45%.
The firm noted that Pinduoduo’s transaction service revenue proved more resilient than anticipated, while sales and marketing expenses came in lower than projected for the quarter. According to InvestingPro analysis, the company’s attractive P/E ratio of 13.6 and PEG ratio of 0.58 suggest potential value opportunity, with additional insights available through the comprehensive Pro Research Report.
HSBC revised its Temu GMV (gross merchandise value) estimate upward after observing that Pinduoduo’s overseas division has implemented alternative custom clearance procedures in the US to mitigate the impact from the removal of the de minimis rule.
The bank also cited competitor Meituan’s exit from the community group purchase segment as a factor in raising Pinduoduo’s transaction service revenue forecast, leading to a 3-6% increase in topline estimates for 2025-27 and a 6-18% boost in earnings projections.
HSBC expects Pinduoduo to face less pressure on sales and marketing expenses as competitors benefit less from government subsidies, while stronger-than-expected investment gains significantly improved the firm’s 2025 assumptions.
In other recent news, Pinduoduo Inc. reported its second-quarter 2025 earnings, significantly surpassing expectations with an earnings per share (EPS) of 22.07, compared to the forecasted 14.8. The company’s revenue also exceeded projections, reaching 103.98 billion RMB, above the expected 103.2 billion RMB. In response to these results, several financial firms have adjusted their price targets for Pinduoduo. Macquarie raised its price target to $165, citing strong profit results due to reduced marketing expenses from the company’s international platform, Temu. Similarly, Barclays increased its price target to $165, attributing it to Temu’s growth despite slower growth in Pinduoduo’s China business. Jefferies also raised its target to $146, highlighting the company’s high-quality growth and lower-than-expected marketing expenses. Meanwhile, US Tiger Securities adjusted its price target to $120, noting the better-than-expected profit performance driven by lower operating expenses. These developments reflect a mix of optimism and caution from analysts regarding Pinduoduo’s financial health and market position.
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