JD.com Inc (JD, Financial) has experienced a notable uptick in its stock performance, with a market capitalization now standing at $40.79 billion. The current price of $26.66 reflects a 4.21% gain over the past week and an impressive 25.81% gain over the past three months. When compared to the GF Value of $57.96, JD.com's stock is currently deemed significantly undervalued, a status that has been consistent since the past GF Value of $60.25. This valuation suggests a potential opportunity for investors looking for growth in the retail-cyclical sector.
Introduction to JD.com Inc
JD.com Inc, a titan in the e-commerce industry, is a leading online retail platform in China. The company's business model is built on a foundation of authenticity, efficiency, and a robust fulfilment infrastructure. With a commitment to reliable delivery and a vast selection of products, JD.com has established itself as a formidable competitor in the e-commerce space. The company's direct sales, online marketplace, and omnichannel businesses are all supported by its own nationwide fulfilment infrastructure and last-mile delivery network, staffed by dedicated employees. This strategic approach has positioned JD.com as a key player in the rapidly evolving retail landscape.
Assessing JD.com's Profitability
JD.com's Profitability Rank stands at 6/10, indicating a solid position within the industry. The company's operating margin of 2.89% surpasses 46.71% of its peers, showcasing efficient management. Furthermore, JD.com's return on equity (ROE) of 10.85% and return on assets (ROA) of 4.01% both exceed the industry median, highlighting its ability to generate profits from its equity and assets, respectively. The return on invested capital (ROIC) at 6.96% also indicates that JD.com is effectively converting capital into profitable investments. These figures, combined with five years of profitability over the past decade, demonstrate JD.com's competitive edge in the retail-cyclical sector.
JD.com's Growth Trajectory
JD.com's Growth Rank is a perfect 10/10, reflecting its exceptional expansion in recent years. The company's 3-year revenue growth rate per share of 9.30% and 5-year revenue growth rate per share of 29.10% both outperform a significant majority of its industry counterparts. Looking ahead, the estimated total revenue growth rate of 13.30% for the next 3 to 5 years suggests a strong trajectory for future earnings. Additionally, the 3-year EPS without NRI growth rate of 18.30% and the estimated EPS growth rate of 17.83% for the same future period further solidify JD.com's position as a growth leader in its sector.
Investor Confidence in JD.com
Significant holders of JD.com stock demonstrate confidence in the company's prospects. Dodge & Cox leads the pack with 21,944,549 shares, representing a 1.39% share percentage. Following closely are Chase Coleman (Trades, Portfolio) and Chris Davis (Trades, Portfolio), holding 8,803,991 and 4,490,036 shares, respectively. These substantial investments by prominent investors underscore the market's belief in JD.com's value proposition and future potential.
Competitive Landscape
When compared to its closest competitors, JD.com holds its own with a market cap of $40.79 billion. Coupang Inc (CPNG, Financial) follows with a market cap of $39.17 billion, while Sea Ltd (SE, Financial) and eBay Inc (EBAY, Financial) trail with market caps of $33.16 billion and $26.13 billion, respectively. This positioning reflects JD.com's significant presence and competitive strength within the e-commerce industry.
Conclusion
In conclusion, JD.com Inc's stock presents a compelling case for investors, with its current status as significantly undervalued according to the GF Value. The company's strong growth rank and promising projections for future revenue and EPS growth are key indicators of its potential. Additionally, JD.com's profitability metrics are commendable when compared to industry peers. The confidence shown by significant holders further validates the stock's appeal. Lastly, JD.com's market cap and performance relative to its competitors highlight its robust standing in the e-commerce sector, making it a stock to watch for value investors.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
