5 China Stocks in Ray Dalio’s Portfolio

2. Pinduoduo Inc. (NASDAQ:PDD)

Number of Hedge Fund Holders: 41

Pinduoduo Inc. (NASDAQ:PDD) operates an e-commerce platform in the People’s Republic of China. The company posted upbeat second quarter results, earning 93 cents a share on a revenue of $4.7 billion. Pinduoduo Inc. (NASDAQ:PDD)’s solid performance is an ode to the resilience of Chinese customers, and the company expects strong sales during China’s 618 shopping festival. Ray Dalio owns 4.8 million Pinduoduo Inc. (NASDAQ:PDD) shares as of Q2 2022 worth $297.5 million, representing 1.26% of his total 13F portfolio. 

On August 21, Macquarie analyst Ellie Jiang raised the price target on Pinduoduo Inc. (NASDAQ:PDD) to $104 from $77 and maintained an Outperform rating on the shares after the company reported “strong” Q2 results. She lifted her 2022/23 non-GAAP net profit estimates by 52% and 36%, respectively, to reflect a more optimistic outlook for ads monetization.

According to Insider Monkey’s Q2 data, 41 hedge funds were bullish on Pinduoduo Inc. (NASDAQ:PDD), up from 36 funds in the last quarter. Rajiv Jain’s GQG Partners is the leading position holder in the company, with 6.15 million shares worth about $381 million.

Here is what Tao Value has to say about Pinduoduo Inc. (NASDAQ:PDD) in its Q4 2021 investor letter:

“On the detracting side, one of our largest detractors includes Pinduoduo (ticker: PDD). Pinduoduo (PDD) reported the second consecutive GAAP profit quarter yet missed on the revenue due to nation-wide consumption weakness & scaled back Sales & Marketing efforts. Market disliked it and the stock price plunged on the earnings. In my opinion, the accounting profits proved the original thesis of using S&M to acquire users and using great shopping experience to keep them. After realizing the first growth curve, Pinduoduo now shifted its focus & investment to agriculture. It is still very early, but the reduced size due to price drop warrants a position to watch and continue to grow with such a team with a strong culture.”