- Mizuho analyst James Lee maintained a Buy on JD.com, Inc JD with a price target of $90 (75% upside).
- JD beat top line and margins due to its competitive advantage in supply chain and logistics, which enabled the company to gain share.
- The COVID lockdown impact in 2Q22 was more than Lee's expectation at 5% YoY growth, three points below Lee's prior estimate as the company is over-indexed to top-tier markets.
- Also Read: Here's Why JPMorgan Upgraded Alibaba, Other Chinese Stocks Months After Calling Them 'Uninvestable'
- However, management initiated cost-containment efforts to mitigate risks and saw OPI be stable compared to last year and more or less in line with Lee's estimate.
- With COVID a short-term headwind, Lee maintained FY24 EBITDA of 51 billion RMB.
- Lee maintained JD as a top pick in China Internet and PT at $90, based on SOTP and representing 9x FY24 Core retail EBITDA.
- Price Action: JD shares traded lower by 5.18% at $50.89 on the last check Wednesday.
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