JD Q3 Earnings Preview: What to Expect?

The company’s performance might have been impacted by the slowdown in China’s economy. Additionally, an aggressive competitive pricing strategy is expected to have affected the company’s revenue performance.

Overall, the Street expects JD.com to post adjusted earnings of $0.81 per ADS in Q3, lower than the prior-year quarter figure of $0.86 per ADS. Meanwhile, analysts expect the company to report net revenue of $33.9 billion, down 4.5% year-over-year.

Ahead of the Q3 earnings release, analyst James Lee of Mizuho Securities believes that uncertainty in China’s internet sector and subdued real estate market activity might have influenced JD.com’s Q3 performance to some extent.

However, the analyst is optimistic about the company’s long-term growth. The analyst expects strong international travel demand to support JD.com’s performance in the near future. Further, Lee is optimistic about the impact of the Double 11 annual sales event, China’s biggest annual shopping festival, held on November 11. As a result, Lee maintained a Buy rating on the stock but lowered the price target to $40 from $60.

The average JD.com price forecast of $44.34 implies 72.2% upside potential from current levels. Also, analysts have a Moderate Buy consensus rating on JD stock based on 13 Buy and six Hold recommendations.