NASDAQ:PDD—Positioned as a High-Growth Stock, Ready for a Potential Breakout.

Last update: Dec 20, 2024

In this article, we'll take a closer look at PDD HOLDINGS INC (NASDAQ:PDD) as a potential candidate for growth investing. While it's important for investors to conduct their own research, PDD HOLDINGS INC has piqued our interest by appearing on our strong growth and breakout radar. Let's explore further.

Looking at the Growth

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:PDD boasts a 8 out of 10:

PDD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 113.90%, which is quite impressive.
Looking at the last year, PDD shows a very strong growth in Revenue. The Revenue has grown by 87.39%.
The Revenue has been growing by 79.96% on average over the past years. This is a very strong growth!
The Earnings Per Share is expected to grow by 23.38% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 27.10% on average over the next years. This is a very strong growth

Evaluating Health: NASDAQ:PDD

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 5.82. This indicates that PDD is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 5.82, PDD belongs to the best of the industry, outperforming 81.25% 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.
Looking at the Debt to FCF ratio, with a value of 0.04, PDD belongs to the top of the industry, outperforming 93.75% of the companies in the same industry.
A Debt/Equity ratio of 0.02 indicates that PDD is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.02, PDD is doing good in the industry, outperforming 78.13% of the companies in the same industry.
PDD has a Current Ratio of 2.15. This indicates that PDD is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.15, PDD is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
A Quick Ratio of 2.15 indicates that PDD has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 2.15, PDD belongs to the best of the industry, outperforming 81.25% of the companies in the same industry.

Analyzing Profitability Metrics

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:PDD, the assigned 8 is a significant indicator of profitability:

Looking at the Return On Assets, with a value of 23.19%, PDD belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
PDD's Return On Equity of 38.87% is amongst the best of the industry. PDD outperforms 93.75% of its industry peers.
PDD has a better Return On Invested Capital (31.27%) than 100.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for PDD is significantly above the industry average of 11.71%.
The 3 year average ROIC (17.97%) for PDD is below the current ROIC(31.27%), indicating increased profibility in the last year.
With an excellent Profit Margin value of 29.10%, PDD belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
With an excellent Operating Margin value of 28.28%, PDD belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
Looking at the Gross Margin, with a value of 62.06%, PDD belongs to the top of the industry, outperforming 84.38% of the companies in the same industry.

How does the Setup look for NASDAQ:PDD

Besides the Technical Rating, ChartMill also assign a Setup Rating to every stock. This setup score also ranges from 0 to 10 and determines to which extend the stock is consolidating. This is achieved by evaluating multiple short term technical indicators. NASDAQ:PDD currently has a 7 as setup rating:

PDD has a bad technical rating, but it does show a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a support zone below the current price at 98.15, 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.

For an up to date full technical analysis you can check the technical report of PDD

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.