JD(JD) ZACKS·2025-05-09 16:20Core Viewpoint - JD.com is expected to report first-quarter 2025 results on May 13, with revenue estimates of 1.05, indicating a 34.62% increase from the previous year [1] Financial Performance - The Zacks Consensus Estimate for JD's earnings per share for the current quarter is $1.05, consistent with previous estimates [2] - JD's earnings surprise history shows a 13.33% surprise in the last quarter, with an average surprise of 25.23% over the last four quarters [4] Growth Factors - JD.com experienced a strong fourth quarter in 2024, with revenues growing 13% year-over-year and non-GAAP net profit increasing by 34% [6] - The top-line growth in Q4 was driven by a 16% increase in electronics and home appliances revenues and an 11% rise in general merchandise revenues, supported by government stimulus and improved supply chain capabilities [7] Challenges - Sales of home appliances in early 2025 were negatively impacted due to demand being pulled forward into late 2024 [7] - The Jingxi business segment faced a significant revenue decline of 31% year-over-year, with a widening non-GAAP operating loss due to adjustments and a focus on lower-tier markets [8] - JD's aggressive investments in AI and robotics, while aimed at improving operational efficiency, are expected to increase short-term operating expenses [9] Market Position - JD.com shares have declined 19.1% over the past three months, underperforming the Internet - Commerce industry and major indices [11] - The current forward 12-month P/E ratio for JD is 7.28X, significantly lower than the industry average of 21.31X, indicating a potentially undervalued position relative to expected earnings growth [14] Investment Considerations - Despite strong year-over-year growth expectations, JD.com faces near-term challenges from Jingxi adjustments, pulled-forward demand, and rising expenses from AI and logistics investments [18] - The stock remains unattractive for investors until clearer recovery indicators emerge [19]