Investors seeking growth at a reasonable cost should explore NASDAQ:PDD.

Here's PDD HOLDINGS INC (NASDAQ:PDD) for you, a growth stock our stock screener believes is undervalued. NASDAQ:PDD is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

Growth Assessment of NASDAQ:PDD

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:

• 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%.
• PDD shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 79.96% yearly.
• Based on estimates for the next years, PDD will show a very strong growth in Earnings Per Share. The EPS will grow by 23.38% on average per year.
• The Revenue is expected to grow by 26.33% on average over the next years. This is a very strong growth

Valuation Insights: NASDAQ:PDD

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:PDD has achieved a 9 out of 10:

• PDD is valuated reasonably with a Price/Earnings ratio of 11.93.
• PDD's Price/Earnings ratio is a bit cheaper when compared to the industry. PDD is cheaper than 77.42% of the companies in the same industry.
• PDD's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.62.
• A Price/Forward Earnings ratio of 10.22 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 80.65% 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 (22.70), we can say PDD is valued rather cheaply.
• Based on the Enterprise Value to EBITDA ratio, PDD is valued a bit cheaper than 77.42% of the companies in the same industry.
• 80.65% of the companies in the same industry are more expensive than PDD, based on the Price/Free Cash Flow ratio.
• PDD's 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 34.87% in the coming years.

ChartMill's Evaluation of Health

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:PDD, the assigned 9 reflects its health status:

• PDD has an Altman-Z score of 6.77. 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 6.77, PDD belongs to the top of the industry, outperforming 87.10% 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's Debt to FCF ratio of 0.04 is amongst the best of the industry. PDD outperforms 93.55% of its industry peers.
• A Debt/Equity ratio of 0.02 indicates that PDD is not too dependend on debt financing.
• PDD has a better Debt to Equity ratio (0.02) than 77.42% of its industry peers.
• A Current Ratio of 2.15 indicates that PDD has no problem at all paying its short term obligations.
• PDD's Current ratio of 2.15 is fine compared to the rest of the industry. PDD outperforms 77.42% of its industry peers.
• PDD has a Quick Ratio of 2.15. This indicates that PDD is financially healthy and has no problem in meeting its short term obligations.
• PDD has a Quick ratio of 2.15. This is amongst the best in the industry. PDD outperforms 90.32% of its industry peers.

Exploring NASDAQ:PDD's Profitability

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:PDD was assigned a score of 8 for profitability:

• PDD has a Return On Assets of 23.19%. This is amongst the best in the industry. PDD outperforms 100.00% of its industry peers.
• PDD's Return On Equity of 38.87% is amongst the best of the industry. PDD outperforms 93.55% of its industry peers.
• PDD has a Return On Invested Capital of 31.27%. This is amongst the best in the industry. PDD outperforms 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 (31.27%) for PDD is above the 3 year average (17.97%), which is a sign of increasing profitability.
• PDD has a better Profit Margin (29.10%) than 100.00% of its industry peers.
• PDD has a better Operating Margin (28.28%) than 100.00% of its industry peers.
• PDD's Gross Margin of 62.06% is amongst the best of the industry. PDD outperforms 83.87% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

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

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.