Pinduoduo (PDD.US) 's robust 1Q24 growth and margin suggested that Temu's losses started narrowing evidently, representing an incremental and meaningful positive for Pinduoduo's fundamentals, while other positive factors remained intact, including domestic e-commerce market share growth, stronger monetization, and Temu's rapid growth, JPMorgan said in a report. The broker said Pinduoduo's earnings have massive upside and Temu's narrowing losses have not yet been factored in by the market.
JP Morgan raised its adjusted EPS forecast for Pinduoduo by about 30% for 2024 and 2025, and expected Temu's losses to halve in 2024. Based on the earnings revisions, the broker reiterated Pinduoduo's Overweight rating and raised its TP from US$190 to US$220.
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