Investment Rating - The report maintains a "BUY" rating for JD.com with an unchanged DCF-based target price of US26.76 [10][22]. Core Insights - JD.com is expected to report 2Q24 revenue of RMB290.9 billion, reflecting a 1.0% year-over-year increase, and a non-GAAP net income of RMB9.9 billion, which is 16% better than Bloomberg consensus estimates [2][12]. - The company is focusing on return on investment (ROI) and quality growth strategies, which may lead to better-than-expected earnings despite challenges in the electronic and home appliance sectors [2][12]. - JD Retail's revenue is projected to be RMB254.2 billion in 2Q24, up 0.3% year-over-year, with a non-GAAP operating profit of RMB9.2 billion, representing a 12% increase year-over-year [2][12]. Revenue and Earnings Forecast - The revenue forecast for 2024-2026 has been revised down by 0.6-0.9% due to a lower expectation for electronic and home appliance revenue, while the non-GAAP net income forecast has been lifted by 4-5% due to more efficient spending [2][12]. - JD's projected revenue for 2024 is RMB1,150.6 billion, with a gross profit of RMB173.6 billion and a non-GAAP net profit of RMB38.5 billion [4][19]. - The non-GAAP net margin is expected to improve to 3.6% in 2024, up from 3.2% in 2023 [4][21]. Valuation Metrics - JD's current valuation is at 8/7x 2024/2025E non-GAAP PE, which is considered not demanding compared to an 11% non-GAAP earnings CAGR over 2023-2026 [2][12]. - The target price of US$51.9 translates into a 15x 2024E PE (non-GAAP) [12][22]. Key Catalysts - Potential catalysts for JD's valuation include further enhancement of shareholder returns and a recovery in consumer spending, which could improve revenue and earnings growth outlook [2][12].
京东：Expecting an upbeat bottom line for 2Q results