JD.com JD shares have returned 48.7% in the trailing 12-month period, outperforming the Zacks Retail-Wholesale sector and the S&P 500 index’s growth of 12.5% and 8.2%, respectively. The stock has also outperformed the Zacks Internet - Commerce industry’s appreciation of 15% in the same time frame.
JD’s shares have been riding on its leading position as a supply chain-based e-commerce giant in China. While its impressive price performance has caught investors’ attention, JD.com’s strength goes beyond short-term momentum. Let’s take a closer look at why this stock deserves a place in your portfolio.
JD.com’s One-Year Price Return Performance
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How JD Retail Strengthens Its Edge in a Competitive Market
The online retail industry in China is intensely competitive. JD.com’s current competitors in China include Alibaba BABA and PDD Holdings Inc. Sponsored ADR PDD. Globally, JD.com faces intense competition from the e-commerce behemoth Amazon AMZN.
Alibaba serves about 80% of the Chinese e-commerce market, while PDD Holdings Inc. offers deep discounts and group-buying deals. Amazon keeps its retail business very hard to beat on price, choice and convenience. Shares of Alibaba, PDD Holdings Inc. and Amazon have returned 82.3%, 3.3% and 6.5%, respectively, in the trailing 12 months.
Amid this intense competition, JD.com has been making strategic moves to stay ahead. The company is focused on improving its services for PLUS members by adding new benefits like a lifestyle package and better return policies for electronics. It has also expanded free shipping and worked on making brand products more affordable.
JD is also expanding into on-demand retail, including food delivery, to enhance user engagement. By improving delivery speed and supporting high-quality restaurants, JD aims to strengthen customer trust and loyalty. The company continues to invest in supply chain capabilities and new business models, ensuring long-term growth and better profitability.
JD’s AI Initiatives Driving Efficiency and Growth
JD.com is accelerating its adoption of AI to automate processes and enhance efficiency. AI is already integrated into key areas like marketing, customer service, search algorithms, and internal workflows. These advancements are improving traffic allocation and enhancing the overall user experience.
The company has launched AI shopping assistants, which provide users with personalized search results and deal comparisons. AI is also transforming JD’s supply chain and merchant support. AI algorithms are improving demand-supply matching, while automation in logistics is reducing costs. With AI playing an increasingly vital role, JD is set to drive long-term efficiency, growth and a better user experience.
JD’s Strategic Expansion Beyond Retail
JD Auto Service, the automotive division of JD.com, has partnered with Continental Tire to achieve a significant breakthrough in their seven-year collaboration. Together, they have introduced China’s first instant tire delivery and installation service. This service gives JD.com a unique competitive edge by simplifying tire purchases for customers and expanding its auto services.
JD Logistics has expanded its presence in Europe by opening its third warehouse in Poland, adding nearly 10,000 square meters of storage space. This expansion helps JD Logistics grow internationally and improves efficiency by offering faster logistics solutions.
JD Health has expanded its support for rare disease patients through joint charity programs, assisting more than 23,000 individuals. The initiative provides medical resources, financial aid, and expert consultations, improving patient care and accessibility.
JD’s Earnings Estimate Revisions Show Upward Trend
The Zacks Consensus Estimate for 2025 earnings is pegged at $4.76 per share, which has been revised upward by 6.73% over the past 30 days, indicating 11.74% year-over-year growth.
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The consensus mark for 2025 revenues is pegged at $173.05 billion, suggesting 7.65% year-over-year growth.
JD.com’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 25.23%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
JD Stock is Undervalued
Currently, JD is trading at a discount with a forward 12-month P/E of 8.54X, which is well below the Zacks Internet - Commerce industry’s 20.79X. This reflects a compelling investment opportunity.
The Value Score of A further reinforces an attractive valuation for JD.com at this moment.
JD’s P/E F12M Ratio Depicts Discounted Valuation
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Here’s Why You Should Buy JD Stock Now
With China’s economy steadily rebounding and consumer confidence improving, JD.com is optimistic about sustainable growth in 2025. Government policies have supported recovery, while JD’s widespread AI adoption enhances efficiency. These advancements, along with strong strategies, give JD a competitive edge in an intense market, positioning it for long-term success.
The company's policies related to shareholder benefits, including a 32% increase in annual dividend to $1.0 per ADS and commitment to its $5 billion share repurchase program, make the stock more attractive. JD.com's substantial valuation discount relative to its industry presents a potential margin of safety while also offering strong upside. As the company continues to execute its growth strategy across multiple verticals, this discount creates an attractive opportunity for investors seeking both stability and long-term gains.
JD currently sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of B, a favorable combination that offers a strong investment opportunity, per the Zacks proprietary methodology. You can see the complete list of today’s Zacks #1 Rank stocks here.
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