2024-04-23 15:21:49 ET
Summary
- JD.com, a Chinese online retail marketplace, is one of the largest e-commerce companies in the world, ranking second in revenue behind Amazon.
- The company operates its own supply chain infrastructure, giving it an enduring competitive advantage within its industry.
- JD.com has consistently grown its annual revenues and generated positive free cash flows, with analysts forecasting continued growth in 2024 and 2025.
- When subtracting tangible net equity out of the company's market cap, JD's already-low valuation multiples fall to a ridiculous P/E of 4.8 and P/FCF of 5.2.
Despite operating primarily in China, JD.com, Inc. ( JD ) is one of the largest e-commerce companies in the world. Its namesake retail platform ranks #5 globally in Gross Merchandise Value (GMV), only ~15% behind the #2 spot held by Chinese competitor Pinduoduo, operated by PDD Holdings ( PDD ). The third and fourth spots are held by Alibaba ( BABA )’s Taobao and TMall platforms. Due to its focus on direct retail rather than serving as a middleman between buyers and sellers, JD.com ranks second in the industry in terms of revenue, trailing only Amazon (AMZN).
JD.com has evolved from a mere e-commerce platform into a Chinese logistics giant with a vast shipping, processing, and storage network underpinning its core retail business. The company has invested significantly in logistics infrastructure and equipment in order to bolster its long-term future competitiveness while simultaneously taking advantage of an opportunity for vertical integration. JD’s asset-heavy model gives the company close command over its supply chain, enhancing quality control and cost efficiency....
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JD.com: Profitable Growth On Sale