Stock Analysis: Decent Value Stocks

Fundamental Rating

PDD gets a fundamental rating of 8 out of 10. The analysis compared the fundamentals against 32 industry peers in the Broadline Retail industry. Both the health and profitability get an excellent rating, making PDD a very profitable company, without any liquidiy or solvency issues. PDD is evaluated to be cheap and growing strongly. This does not happen too often! These ratings could make PDD a good candidate for value and growth and quality investing.

1. Profitability

1.1 Basic Checks

In the past year PDD was profitable.

In the past year PDD had a positive cash flow from operations.

In multiple years PDD reported negative net income over the last 5 years.

In the past 5 years PDD always reported a positive cash flow from operatings.

1.2 Ratios

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 93.75% of its industry peers.

The Return On Invested Capital of PDD (31.27%) is better 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.

		Industry Rank	Sector Rank
ROA	23.19%
ROE	38.87%
ROIC	31.27%

ROA(3y)11.61%

ROA(5y)4.23%

ROE(3y)23.06%

ROE(5y)5.8%

ROIC(3y)17.97%

ROIC(5y)N/A

1.3 Margins

PDD has a better Profit Margin (29.10%) than 100.00% of its industry peers.

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.

The Gross Margin of PDD (62.06%) is better than 84.38% of its industry peers.

PDD's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	28.28%
PM (TTM)	29.1%
GM	62.06%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y-2.34%

GM growth 5Y-4.16%

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), PDD is creating value.

Compared to 1 year ago, PDD has more shares outstanding

PDD has more shares outstanding than it did 5 years ago.

The debt/assets ratio for PDD has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 5.75 indicates that PDD is not in any danger for bankruptcy at the moment.

PDD has a Altman-Z score of 5.75. This is amongst the best in the industry. PDD outperforms 81.25% of its industry peers.

The Debt to FCF ratio of PDD is 0.04, which is an excellent value as it means it would take PDD, only 0.04 years of fcf income to pay off all of its debts.

PDD has a better Debt to FCF ratio (0.04) than 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.

PDD has a Debt to Equity ratio of 0.02. This is in the better half of the industry: PDD outperforms 78.13% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.02
Debt/FCF	0.04
Altman-Z	5.75

ROIC/WACC4.33

WACC7.23%

2.3 Liquidity

A Current Ratio of 2.15 indicates that PDD has no problem at all paying its short term obligations.

With a decent Current ratio value of 2.15, PDD is doing good in 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.

PDD's Quick ratio of 2.15 is amongst the best of the industry. PDD outperforms 81.25% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.15
Quick Ratio	2.15

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

3. Growth

3.1 Past

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.

PDD shows a strong growth in Revenue. In the last year, the Revenue has grown by 87.39%.

Measured over the past years, PDD shows a very strong growth in Revenue. The Revenue has been growing by 79.96% on average per year.

EPS 1Y (TTM)113.9%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%60.12%

Revenue 1Y (TTM)87.39%

Revenue growth 3Y60.86%

Revenue growth 5Y79.96%

Sales Q2Q%44.33%

3.2 Future

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

EPS Next Y79.07%

EPS Next 2Y42.8%

EPS Next 3Y35.68%

EPS Next 5Y23.38%

Revenue Next Year67.82%

Revenue Next 2Y44.82%

Revenue Next 3Y36.25%

Revenue Next 5Y27.1%

3.3 Evolution

Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

PDD is valuated reasonably with a Price/Earnings ratio of 9.03.

84.38% of the companies in the same industry are more expensive than PDD, based on the Price/Earnings ratio.

Compared to an average S&P500 Price/Earnings ratio of 27.55, PDD is valued rather cheaply.

The Price/Forward Earnings ratio is 7.64, which indicates a rather cheap 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 87.50% 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 (24.00), we can say PDD is valued rather cheaply.

		Industry Rank	Sector Rank
PE	9.03
Fwd PE	7.64

4.2 Price Multiples

PDD's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. PDD is cheaper than 87.50% of the companies in the same industry.

Based on the Price/Free Cash Flow ratio, PDD is valued cheaply inside the industry as 87.50% of the companies are valued more expensively.