NASDAQ:PDD is an undervalued gem with solid fundamentals.

Discover PDD HOLDINGS INC (NASDAQ:PDD), an undervalued stock highlighted by our stock screener. NASDAQ:PDD showcases solid financial health and profitability while maintaining an appealing valuation. We'll explore the details.

Exploring NASDAQ:PDD's Valuation

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:PDD has received a 8 out of 10:

• Based on the Price/Earnings ratio, PDD is valued a bit cheaper than the industry average as 62.50% of the companies are valued more expensively.
• PDD's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 31.73.
• A Price/Forward Earnings ratio of 9.29 indicates a reasonable valuation of PDD.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of PDD indicates a rather cheap valuation: PDD is cheaper than 81.25% of the companies listed in the same industry.
• When comparing the Price/Forward Earnings ratio of PDD to the average of the S&P500 Index (22.71), we can say PDD is valued rather cheaply.
• PDD's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PDD is cheaper than 68.75% of the companies in the same industry.
• PDD's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. PDD is cheaper than 78.13% of the companies in the same industry.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• PDD has an outstanding profitability rating, which may justify a higher PE ratio.
• A more expensive valuation may be justified as PDD's earnings are expected to grow with 38.66% in the coming years.

Profitability Assessment of NASDAQ:PDD

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:PDD has earned a 8 out of 10:

• PDD has a Return On Assets of 22.84%. This is amongst the best in the industry. PDD outperforms 100.00% of its industry peers.
• PDD has a Return On Equity of 38.91%. This is amongst the best in the industry. PDD outperforms 96.88% of its industry peers.
• The Return On Invested Capital of PDD (31.76%) is better than 100.00% of its industry peers.
• The Average Return On Invested Capital over the past 3 years for PDD is significantly above the industry average of 11.61%.
• The last Return On Invested Capital (31.76%) for PDD is above the 3 year average (17.97%), which is a sign of increasing profitability.
• PDD has a better Profit Margin (28.93%) than 100.00% of its industry peers.
• The Operating Margin of PDD (28.57%) is better than 100.00% of its industry peers.
• With an excellent Gross Margin value of 62.44%, PDD belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.

Understanding NASDAQ:PDD's Health

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 9 for health provides valuable insights:

• PDD has an Altman-Z score of 6.99. 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 6.99, PDD belongs to the top of the industry, outperforming 90.63% of the companies in the same industry.
• PDD has a debt to FCF ratio of 0.04. This is a very positive value and a sign of high solvency as it would only need 0.04 years to pay back of all of its debts.
• PDD has a Debt to FCF ratio of 0.04. This is amongst the best in the industry. PDD outperforms 93.75% 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.
• The Debt to Equity ratio of PDD (0.02) is better than 78.13% of its industry peers.
• A Current Ratio of 2.11 indicates that PDD has no problem at all paying its short term obligations.
• With a decent Current ratio value of 2.11, PDD is doing good in the industry, outperforming 71.88% of the companies in the same industry.
• PDD has a Quick Ratio of 2.11. This indicates that PDD is financially healthy and has no problem in meeting its short term obligations.
• PDD's Quick ratio of 2.11 is amongst the best of the industry. PDD outperforms 81.25% of its industry peers.

Understanding NASDAQ:PDD's Growth

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:PDD scores a 8 out of 10:

• The Earnings Per Share has grown by an impressive 112.20% over the past year.
• Looking at the last year, PDD shows a very strong growth in Revenue. The Revenue has grown by 106.72%.
• The Revenue has been growing by 79.96% on average over the past years. This is a very strong growth!
• PDD is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 30.86% yearly.
• 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.

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

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.